Thu. Jan 20th, 2022

South Korea’s exports in November were the largest monthly figure on record, driven by rising prices and volumes.

South Korean exports grew at the fastest pace in three months in November thanks to post-pandemic recovery in major trading partners that boosted demand for chips and petrochemicals, but the Omicron variant could pose a risk to the export-dependent economy.

Exports rose 32.1 percent in November from a year earlier, the sharpest since August and largely beating the 27.7 percent growth seen in a Reuters poll. It was also the ninth consecutive month of double-digit expansion.

Total exports stood at $ 60.44 billion in November, the largest monthly figure on record, according to data from the Ministry of Trade.

The result bodes well for a Korean economy that has relied on exports to support growth amid, once again, occasional COVID-19 constraints hampering recovery in household spending. The approaching holiday season has probably provided overseas demand, while stabilization in China’s manufacturing sector has provided additional support.

“Wednesday’s export data looks pretty good. “Despite concerns about easing Chinese demand and a slowdown in the semiconductor industry, exports are considered resilient,” said Park Sang-hyun, chief economist at Hi Investment & Securities.

“The development of the Omicron variant and supply chain issues are the key variables for exports, but for now it looks like the recovery momentum will continue in December and throughout 2022.”

Thirteen of 15 key items grew in sales, with those of semiconductors, petrochemicals and vessels rising 40.1 percent, 63 percent and 237.6 percent, respectively. Exports of car components fell by 2.2 percent as a shortage of car chips disrupted global car production.

Meanwhile, exports to all nine major trading partners grew, with those to China, the United States and the European Union rising 27.1 percent, 22 percent and 18.9 percent, respectively.

Vaccine manufacturer Moderna’s CEO on Tuesday questioned the efficacy of COVID-19 vaccines against the variant, shocking financial markets and exacerbating concerns about further supply chain disruption.

South Korea reported a record 5,123 coronavirus cases for Tuesday, but no Omicron case has been reported so far.

Wednesday’s data also showed that imports rose by 43.6 percent year-on-year, also beating the forecast of 40.5 percent expansion and standing at $ 57.36 billion. That brought the trade surplus to $ 3.09 billion.

November’s export performance was a combination of rising prices and volumes, the ministry said. Export prices rose 22.1 percent, while volume rose 8.2 percent.

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