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Exports to remain in doldrums amid weak tech demand: think tanks

06:00 January 26, 2023

SEOUL, Jan. 26 (Yonhap) -- South Korea's exports could remain in the doldrums for the time being amid the slowing demand for tech products coupled with the delayed recovery of the global economy, local think tanks said Thursday.

"South Korea's sluggish exports (this year) will be largely affected by the downcycle of the chip industry," the Korea Development Institute said in a statement, compiled by the Ministry of Trade, Industry, and Energy.

The Korea Institute for Industrial Economics and Trade echoed the view, pointing out that the global demand for memory chips is anticipated to lose ground in 2023 due to the base effect as well.

Outbound shipments of chips, South Korea's key export item, inched up 1 percent on-year in 2022 to a record high of $129.23 billion amid a global economic recovery in the first several months of last year.

Other think tanks added South Korea is not likely to post a rebound in its exports soon, due to the rising COVID-19 infections in China and monetary-tightening moves by the United States and the European Union.

"The prolonged war between Russia and Ukraine, along with rate hikes, will escalate global risks, leading to an economic slowdown of major export partners, including the U.S., China, and Asia," the Institute for International Trade under the Korea International Trade Association said.

South Korea's exports fell 2.7 percent on-year in the first 20 days of January, the Korea Customs Service said earlier this month, due mainly to weak semiconductor shipments.



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