South Korea’s export posts single-digit fall in four months

SEOUL (XINHUA) – South Korea’s export posted a single-digit fall in four months, showing signs of recovery from an economic fallout from the COVID-19 outbreak across the world, a government report showed yesterday.

Export, which accounts for about half of the export-driven economy, reached USD42.83 billion in July, down seven per cent from a year earlier, according to the South Korea’s Ministry of Trade, Industry and Energy.

The outbound shipment shed in single figures in four months, after tumbling 25.5 per cent in April, 23.6 per cent in May and 10.9 per cent in June.

The daily average export slipped seven per cent over the year to USD1.71 billion in July, topping USD1.7 billion in four months.

Import retreated 11.9 per cent from a year earlier to USD38.56 billion in July, sending the trade surplus to USD4.27 billion. The trade balance stayed in black for the third consecutive month.

The trade surplus increased from USD390 million in May to USD3.63 billion in June and USD4.27 billion in July.

The improved export came as global demand partially recovered since May amid the reopening of businesses after shutdowns to tackle the COVID-19 pandemic in major economies.

South Korea’s industrial output grew 4.2 per cent in June from a month ago, marking the first rebound in six months.

Both private consumption and facility investment expanded in the month.

Real gross domestic product (GDP) slumped 3.3 per cent in the second quarter from the previous quarter, but it was better than the GDP falls in major economies, including the United States (US), Germany and France.

South Korea’s Finance Ministry forecast that the real GDP could turn around during the third quarter thanks to fiscal stimulus packages and accommodative monetary policy as well as the global economic recovery.

Export to China, South Korea’s biggest trading partner, gained 2.5 per cent in July from a year earlier, after expanding 6.9 per cent in June.

Shipment to the US advanced 7.7 per cent last month.

It marked the first time in 21 months since October 2018 that export to both China and the US increased on a yearly basis. Shipment to China and the UStakes up about 40 per cent of South Korea’s total export.

Shipment to the European Union (EU) reduced 11.1 per cent in July from a year earlier, but it was down from declines of 22.6 per cent in May and 17.0 per cent in June.

Export to the Association of Southeast Asian Nations (ASEAN), Japan and Latin America diminished in double figures last month amid the lingering effect from the COVID-19 pandemic.

By item, semiconductor export rose 5.6 per cent thanks to solid demand for chips used for servers and computers.

Amid the fear of the virus infection, people preferred to work at home and attend online classes, resulting in strong demand for computers and higher data transmission.

Computer shipment jumped 77.1 per cent last month, keeping an upward trend for the 10th consecutive month.

Export of telecommunication devices, such as smartphone, made the first rebound in four months, and consumer electronics shipment turned around in five months.

Automotive export dipped 4.2 per cent in July from a year earlier, but it was sharply slower than a 54 per cent drop tallied in May.

It was attributable to recovering demand from Europe and the US.

Auto parts shipment plunged 27.7 per cent as global automakers adjusted production to tackle increased inventory, and export for general machinery, steel products and textiles all shrank in double digits.

Export for oil products and petrochemicals dived 43.2 per cent and 21.0 per cent each amid the global supply glut and lower product price.