South Korea's early April exports tumble as global demand falls

SEOUL • South Korean exports for the first 10 days of this month tumbled as the coronavirus crisis upended global supply chains and knocked demand.

Asia's fourth-largest economy is considered a bellwether for world trade and is the first major exporting nation to release monthly trade data.

Exports for the first 10 days of the month dived 18.6 per cent from the same period a year earlier, a sharp reversal from the 20.8 per cent jump in the period from March 1 to 10. Imports also dropped 13 per cent, compared with a 14.5 per cent rise in the previous month, according to Korea Customs Service data yesterday.

Shipments to China, South Korea's biggest trading partner and where the virus originated late last year, declined 10.2 per cent, while those to the United States and the European Union also fell 3.4 per cent and 20.1 per cent, respectively.

By products, overseas sales of semiconductors, the country's top export revenue generator, declined 1.5 per cent, while those of petrochemical products, car components and wireless devices plummeted 47.7 per cent, 31.8 per cent and 23.1 per cent, respectively.

Earlier this month, data for March showed shipments slipped back to contraction as the coronavirus ravaged the global economy, although solid chip demand provided a rare bright spot as lockdowns across the world forced millions to use telecommuting technology.

Analysts said South Korea's economy - heavily dependent on exports of computer chips, smartphones, cars and ships - is headed for a contraction in the first half of the year even after rate cuts, the supplementary budget and the government's rescue packages.

"As Monday's data is based on a short period of 10 days, it is premature to say the exports are back into the contraction phase in earnest... along with the plunge in global oil price, the coronavirus impact seems to have partially affected the data," said a Customs agency official.

The pandemic's global impact has rippled through to many businesses from airlines to manufacturing and services sectors.

Kia Motors told its labour union in South Korea that it wants to suspend operations at three of its factories in the country as the coronavirus outbreak weighs on exports to Europe and the US.

REUTERS