Korea Eximbank Forecasts 4-5% Year-on-Year Increase in Q4 Exports

The Korea Eximbank Overseas Economic Research Institute forecasted on the 1st that exports in the fourth quarter of this year will increase by about 4-5% compared to the same period last year.

[Image source=Yonhap News]

In its 'Evaluation of Export Performance in the Third Quarter of 2023 and Outlook for the Fourth Quarter' released on the same day, Eximbank stated that exports in the fourth quarter of this year are expected to reach around $165 billion, an increase of 4-5% compared to the same period last year.

The background for this outlook is that the export leading index has risen for two consecutive quarters compared to the previous quarter. The export leading index is an index that predicts the degree of export increase or decrease by synthesizing variables affecting exports, such as the economic conditions of major export destinations, import volume for exports, order status by industry, and exchange rates.

In the third quarter, the export leading index rose by 0.6 points from the previous quarter to 121.4, and in the fourth quarter, it increased by 1.4 points to 122.7.

In particular, since the fourth quarter began, the Korea Eximbank analysis noted that signs of export recovery are increasing, such as the continued economic improvement in the United States, rising manufacturing new order indices, and increasing export prices.

Eximbank stated, "Due to improvements in the semiconductor industry, an increase in manufacturing new orders, and the base effect from the fourth quarter of last year, exports are expected to turn to an increasing trend for the first time in five quarters. However, if the global economic recovery and semiconductor market improvement are delayed due to worsening economic conditions in China and increased uncertainty from the Middle East conflict, the export growth rate may be reduced."

Meanwhile, Eximbank introduced that a survey conducted over a week from the 4th of last month targeting 538 export companies found that rising raw material prices and instability in the Korean won exchange rate (each 39.8%) were cited as the biggest difficulties.

These were followed by decreased demand due to economic slowdown (32.47%), low-price competition from developing countries such as China (27.1%), and reduced working hours and rising labor costs (12.5%).

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