South Korea is expected to see its exports go up in December for the 15th month in a row, with a predicted increase of 4.0% compared to the same time last year, based on a poll of 10 economists by Reuters. While this shows ongoing growth, the pace is slowing down from a 4.6% increase in October.
Experts believe this slowdown is due to a few reasons, like possible new tariffs from the U.S. and ongoing uncertainties in the global economy. Ha Keon-hyeong from Shinhan Securities pointed out that Donald Trump’s election has created trade policy uncertainties, which could pose risks for South Korean exporters. Additionally, strikes have affected car production, and demand for South Korean goods, other than semiconductors and tech products, is expected to drop.
The poll also predicts that imports will rise by 4.6% in December, leading to an expected trade surplus of $4.21 billion. This follows a trade surplus of $3.17 billion recorded in October.
South Korea’s Ministry of Trade, Industry, and Energy will release the official trade data for December on January 1. Economists warn that while the continuous growth in exports is a good sign, the slowdown indicates that South Korea’s economy, which relies heavily on trade, might face difficulties in continuing its growth amid challenges in the global economy.
To tackle these issues, the South Korean government is implementing several measures to support the economy. The “Korean New Deal Program” involves a $144 billion investment aimed at boosting private spending and job creation, especially in healthcare and green industries. Additionally, the “New Growth Strategy 4.0,” announced in August 2023, includes projects meant to promote long-term industrial growth, such as developments in AI semiconductor technology and clean hydrogen production.
These actions show South Korea’s attempts to manage the challenges of the global economy and maintain its export-driven growth.
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