The Basis for Q4 Export Rebound Outlook... Improvement in Semiconductor and Exports to China

August Exports Down 8.4%, Imports Down 22.8%, Trade Surplus $87 Billion
Semiconductor Exports Down 21%... "Lowest Decline Rate This Year"
Ministry of Industry: "Trade Surplus to Continue in Q4"

The government expects the improvement in the trade balance to continue in the second half of the year and forecasts that exports will turn positive. This is because key Korean export items such as semiconductors and exports to China are showing signs of improvement.

According to the Ministry of Trade, Industry and Energy on the 3rd, the trade surplus that began in June this year continued for three consecutive months until August. However, the surplus amount increased from $1.146 billion in June to $1.652 billion in July, then decreased to $868 million in August.

Kim Wanki, Director of the Trade and Investment Office at the Ministry of Trade, Industry and Energy, said, "We expect the trade surplus trend to remain stable in the second half of this year," adding, "Key export items such as automobiles and ships, which have continuously driven our exports, are showing strong export performance, and the semiconductor industry is gradually improving."

Exports in August amounted to $51.87 billion, down 8.4% compared to the previous year. Although the decline in exports, which began in October last year, has continued for 11 months, the rate of decrease has slowed to single digits. By item, exports increased in six categories: automobiles (29%), auto parts (6%), general machinery (8%), ships (35%), displays (4%), and home appliances (12%). Automobile exports achieved the highest August performance ever, marking 14 consecutive months of export growth. On the other hand, exports of semiconductors (-21%), petroleum products (-35%), petrochemicals (-12%), and steel (-11%) decreased compared to the previous year due to factors such as price declines. However, semiconductor exports, Korea's largest export item, increased by 15% from the previous month to $8.6 billion, continuing the improvement trend since the first quarter low and showing the lowest export decline rate this year.

Director Kim expects exports to turn positive in the fourth quarter of this year. He said, "In addition to automobiles and ships, displays and home appliances are also showing signs of recovery, and this trend is expected to continue next month and through the fourth quarter," adding, "There will be months in the fourth quarter when exports show positive growth, and this upward trend is expected to continue thereafter."

The government plans to prepare support measures for export revitalization at the whole-of-government level early this month. These measures will include ▲ diversification of export items and regions ▲ strengthening export support infrastructure such as trade finance, export marketing, and overseas certification ▲ resolving on-site difficulties faced by export companies.

(Photo) [Image source=Yonhap News]

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