July Exports Also Show 'Red Light'... Government Pushes for 'Major Trade Structure Overhaul'

Exports from the 1st to 20th of this month down 15.2%... 10 Consecutive Months of Decline Inevitable

Exports from the beginning of this month through the 20th have decreased by more than 15%, raising the likelihood that overall exports for July will continue to decline. This is due to sluggish exports of semiconductors and petroleum products caused by a slowdown in global demand and price drops following the fall in oil prices. The government has decided to diversify export countries and product categories.

On the 21st, the Korea Customs Service announced that export value from July 1 to 20 was $31.2 billion, down 15.2% (-$5.61 billion) compared to the same period last year. If this trend continues, exports will inevitably decline for the 10th consecutive month. Exports had decreased year-on-year for nine consecutive months from October last year through last month.

Imports also recorded $32.6 billion, a 28.0% decrease, resulting in a trade deficit of $1.4 billion. Accordingly, cumulative exports through July 20 this year totaled $338.4 billion, down 12.6% from the same period last year. Imports amounted to $366.2 billion, a 9.9% decrease. The trade deficit reached $27.8 billion.

Among the top 10 export items, exports of eight items declined except for passenger cars and computer peripherals. Passenger cars increased by 27.9% year-on-year to $3.4 billion, but semiconductors and petroleum products plunged by 35.4% and 48.7%, respectively.

By country, exports to eight of the top 10 export destinations decreased, except for India (3.6%) and Hong Kong (21.1%). Exports to China (-21.2%), Vietnam (-22.6%), and the United States (-7.3%) declined.

There is still a possibility that the trade surplus recorded last month will continue this month. In June, the trade balance from the 1st to the 20th showed a surplus of $1.6 billion, and overall, a surplus of $1.1 billion was recorded, marking the first surplus in 16 months since February last year.

The government has begun establishing a "Trade Structure Transformation Strategy" to achieve a positive export growth rate as early as possible. Through four divisions?▲diversification of export items and markets ▲high value-added trade ▲expansion of trade scope ▲innovation of trade support systems?the aim is to create a trade structure that can grow stably without being easily shaken by changes in external conditions. Ahn Deok-geun, Director-General for Trade Negotiations at the Ministry of Trade, Industry and Energy, said, "This is a time when efforts to fundamentally change Korea’s trade structure are needed more than ever before. We will break away from the current trade structure concentrated on specific items like semiconductors and markets like China, nurture future promising items, and expand export markets to new promising markets to inject diversity into the export portfolio."

(Photo) [Image source=Yonhap News]

This content was produced with the assistance of AI translation services.