South Korea chip exports rise for first time in more than a year
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South Korea’s chip exports snapped 15 months of decline and rose 12.9 per cent – an indication the slump in semiconductor demand may be bottoming out.
PHOTO: REUTERS
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SEOUL – South Korea’s exports beat expectations and accelerated in November as overseas sales of chips rose for the first time in 16 months, adding to evidence that global demand is strengthening.
Exports by Asia’s fourth-largest economy gained 7.8 per cent year on year to US$55.8 billion (S$74.6 billion), speeding up from a rise of 5.1 per cent a month before to mark the fastest growth since July 2022 and also beating a 4.7 per cent gain in a Reuters poll of economist forecasts.
Chip exports snapped 15 months of decline and rose 12.9 per cent, in an indication that the slump in semiconductor demand may be bottoming out.
“Exports are surely rebounding, thanks to a recovery in chip demand. Car sales are also strong, so we expect overall exports to post a growth of 8 per cent (in 2024),” said Daishin Securities economist Lee Da-eun.
“Having said that, momentum behind chip sales isn’t as strong as we had expected and there are also downside risks from tepid recovery of the Chinese economy.”
South Korean policymakers are pinning hopes on a revival of chip demand to boost growth as restrictive interest rates at home restrain domestic demand.
On Nov 30, the Bank of Korea kept monetary policy unchanged and signalled that it may need to keep interest rates higher for longer to head off persistent inflation risks.
By destination, exports to the United States jumped 24.7 per cent to log a fourth consecutive month of gains, but shipments to China, its biggest trading partner, declined 0.2 per cent.
Imports fell 11.6 per cent to US$52 billion, compared with losses of 9.7 per cent in the month before and the 8.6 per cent expected by economists.
As a result, the country posted a trade surplus of US$3.8 billion in November. It was the biggest monthly surplus since September 2021.
Exports for 12 of the country’s 15 main export items increased in November, including a 38.5 per cent surge in ship exports. Car exports jumped 21.5 per cent, extending gains to a 17th consecutive month. REUTERS
