South Korea’s February exports rebound on chips

Seoul, South Korea’s exports moved up 4.5 percent in February from a year earlier, marking the first rebound after falling for 14 consecutive months, data showed Sunday, led mostly by the robust performance of memory chips and extended working days.

Outbound shipments came to $41.2 billion last month, compared with $39.4 billion posted a year earlier, according to the data compiled by the Ministry of Trade, Industry and Energy, South Korean News Agency (Yonhap) News Agency reported.

But the average daily exports fell 11.7 percent last month to $1.83 billion, compared with a 4.6 percent rise in January.

Imports moved up 1.4 percent on-year in February to $37.1 billion.

The country’s trade surplus came to $4.1 billion in February, marking 97 straight months in which the country’s exports have exceeded imports.

South Korea’s shipments of chips, one of the country’s mainstay export items, rebounded for the first time in 15 months, advancing 9.4 percent on-year last month to $7.4 billion.

The recovery was led by rising demand from data centers, along with an increase in prices of memory chips. Chips accounted for roughly 18 percent of all exports.

Outbound shipments of petrochemical goods moved down 9.7 percent over the period to $3.14 billion due to the weakening business sentiment around the globe, sparked by the spread of the new coronavirus.

Shipments of automobiles slipped 16.6 percent to $2.4 billion as local carmakers faced troubles in securing parts from China in the aftermath of the epidemic that originated there.

Exports of ships, on the other hand, rose 8 percent on the back of rising demand for liquefied natural gas carriers and very large crude carriers.

The ministry said the COVID-19 epidemic has emerged as yet another uncertainty for local exporters.

The country’s exports to China, the top trading partner and the epicenter of the virus outbreak, dipped 6.6 percent on-year in February to $8.9 billion.

But the daily average outbound shipment to the neighbor sank by a wider margin of 21 percent, according to the data.

South Korea’s exports of petrochemical goods and others to the world’s No. 2 economy were especially affected by concerns over the virus.

Compared with the previous outbreaks of diseases, such as SARS, South Korea became more dependent on China for exports, Industry Minister Sung Yun-mo said. Considering China plays a key role in the global supply chain, the country is expected to suffer a bigger setback.

SARS refers to the severe acute respiratory syndrome that broke out in 2003. China accounted for 4.3 percent of the global economy in 2003, which shot up to nearly 16 percent in 2018.

Exports to the United States, on the other hand, advanced 9.9 percent on rising demand for South Korean SUVs and chips.

Outbound shipments to the members of the Association of Southeast Asian Nations (ASEAN) gained 7.5 percent on chips and displays as well.

South Korea’s annual exports fell 10.3 percent in 2019, hit by a slump in the global chip market, coupled with the lengthy trade feud between the United States and China.

For the year, the country’s outbound shipments are forecast to rebound 3 percent on eased trade tension between the country’s two largest trading partners.

The latest global outbreak of the new coronavirus, however, has made the target less feasible.

Source: Bahrain News Agency