Exports Positive for 3 Consecutive Months... "Export Upward Trend to Strengthen in the New Year" (Comprehensive)

Export and Import Trends for December 2023 and the Entire Year

Exports continued to rise in December last year, marking three consecutive months of growth. Although overall exports decreased by more than 7% last year, semiconductor exports have been leading a rebound that began in October. The government expects the upward trend in exports to solidify in the new year.

According to the Ministry of Trade, Industry and Energy on the 1st, exports in 2023 amounted to $632.69 billion, down 7.4% from the previous year. Imports decreased by 12.1% to $642.67 billion, resulting in a trade deficit of $9.97 billion.

An official from the ministry stated, "Despite challenging external conditions such as the global high interest rate environment and delayed economic recovery in China, exports in 2023 showed improvement after hitting a low in the first quarter, driven by continued strong automobile exports, a positive turnaround in general machinery and ship exports after the second quarter, and gradual recovery in semiconductor exports, turning positive in October. The trade balance shifted to a surplus in June due to gradual export improvement and reduced imports from stabilized energy prices, recording a total surplus of $16.3 billion in the second half of the year. Consequently, the trade deficit in 2023 was significantly reduced to $9.97 billion compared to the previous year's deficit of $47.8 billion."

In 2023, exports increased in three major categories: automobiles, general machinery, and ships. Automobile exports reached $70.9 billion, surpassing the previous record set in 2022 ($54.1 billion) by more than 30%, driven by strong sales of high-value vehicles such as electric cars and SUVs. General machinery exports rose by 4.6%, and ship exports increased by 20.9% compared to the previous year. Semiconductor exports, Korea's largest export item, continued their recovery trend after the first quarter low and increased for two consecutive months following a positive turnaround in November.

Export containers are being loaded onto a ship at Busan North Port. Photo by Jinhyung Kang aymsdream@

Last year, exports increased in four of the nine major export markets (the United States, EU, Middle East, and CIS). Notably, exports to the United States reached a record high of $115.7 billion, reclaiming its position as the second-largest export market after ASEAN for the first time in 18 years since 2005. The export share gap between China and the United States, Korea's two largest export markets, narrowed to 1.5 percentage points, the smallest since 2003. Exports to the EU also achieved record highs, supported by strong automobile and general machinery exports.

Exports to China declined by 19.9% due to reduced global imports amid China's economic slowdown, primarily affecting intermediate goods. Exports to ASEAN decreased by 12.5%, mainly in IT components including semiconductors, due to a sluggish global IT industry. However, exports to China exceeded $10 billion for five consecutive months since August, showing signs of improvement, and exports to ASEAN have increased for three consecutive months since turning positive in October.

Exports to Poland (+14.8%), UAE (+11.9%), and Saudi Arabia (+9.4%), key countries visited by President Yoon Suk-yeol, saw significant increases. Poland recorded its highest-ever export performance in 2023, driven by steady growth in its largest export item, cathode materials, and strong K-defense exports, rising to become the second-largest export country within the EU after Germany. The UAE achieved exports exceeding $4 billion for the first time in five years since 2018, centered on automobiles, car parts, and general machinery. Saudi Arabia's exports recovered to the $5 billion level for the first time in six years since 2017, supported by strong automobile exports and increased exports of general machinery and steel linked to large-scale construction projects.

Exports in December last year increased by 5.1% year-on-year to $57.66 billion, imports decreased by 10.8% to $53.18 billion, and the trade balance recorded a surplus of $4.48 billion.

Despite two fewer working days compared to the previous year, December exports rose for the third consecutive month, achieving the highest export performance in 17 months since July 2022 ($60.2 billion). Particularly, the average daily export growth rate, adjusted for working days, reached double digits at 14.5%, the highest in 18 months since June 2022 (14.9%). Export volume also increased by 4.7%, marking four consecutive months of growth.

Visiting Minister of Trade, Industry and Energy Bang Moon-kyu (left) visited Korean Air's Cargo Terminal 1 at Incheon Airport on the 1st to encourage on-site workers as the first export site of the new year 2024.

Minister of Trade, Industry and Energy Bang Moon-kyu said, "Despite difficult conditions, 2023 was a year in which exports turned positive and the trade balance shifted to surplus in October, overcoming the export crisis earlier than East Asian competitors. The significant reduction in the trade deficit and higher export volume in the second half compared to the first half demonstrate a pattern of growth starting low and ending high. In 2024, we will fully support efforts to maintain an upward export trajectory and ensure that exports remain a key driver of our economic growth."

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