Market & Policy

South Korea's Exports and Imports Decline in January.

by Philip Lee

Updated June 25, 2023

South Korea's Exports and Imports Decline in January. — Photo by CHUTTERSNAP / Unsplash

According to the Ministry of Trade, Industry, and Energy, South Korea’s exports fell 16.6% YoY to $46.3 billion in January. Imports also decreased by 2.6% to $59.0 billion, resulting in a trade deficit of $12.7 billion.

The export decline is attributed to a high base effect from January of the previous year and global economic factors, including high inflation and interest rates.

Semiconductor exports were particularly hard-hit, falling 44.5% to $4.8 billion, with core parts such as DRAM, NAND, and memory chips experiencing significant price drops and weakened demand.

Display exports also decreased 36.0% to $1.3 billion, as unit prices of OLED products declined due to increased productivity amid an economic slowdown. Steel exports and petrochemicals also suffered, decreasing by 25.9% and 25.0%, respectively.

On the other hand, automobile and petroleum exports achieved double-digit growth, with automobiles posting a historic high of 21.9% to $5.0 billion, driven by expanding demand for eco-friendly vehicles, SUVs, and high-value-added vehicles.

The shipbuilding industry also recorded growth of 86.3% to $1.4 billion due to expanding overseas demand for large container ships and LNG carriers.

Wireless communication devices experienced positive growth for the first time in 10 months, up 17.9% to $1.6 billion, fueled by the upcoming release of a new smartphone model.

Exports to the EU and GCC rose slightly, by 0.2% and 4.0%, respectively, while exports to other regions decreased due to global inflation, austerity measures, and sluggish growth.

Outbound shipments to China (down 31.4 percent to $9.2 billion), the U.S. (down 6.1 percent to $8.1 billion), ASEAN (down 19.8 percent to $8.3 billion), Japan (down 12.7 percent to $2.3 billion), and Latin America (down 25.0 percent to $1.7 billion) diminished.

In conclusion, the South Korean economy faces significant headwinds in declining exports, high inflation, and sluggish growth in key markets.

However, certain sectors, such as automobiles, shipbuilding, and wireless communication devices, are showing positive signs of growth.