In the fifth straight month of decline, overall exports took another hit last month, with semiconductor exports experiencing a sharp drop to almost half. In contrast, energy imports surged by nearly 20% year-on-year, causing a trade deficit for the twelfth month. Despite the government's all-out efforts to boost exports, the Korean economy is projected to grow by only around 1% this year, and the country remains mired in a negative trend.
As per the latest "February Export-Import Trends" report released by the Ministry of Trade, Industry, and Energy on Wednesday, the total export value for the previous month stood at 50.1 billion U.S. dollars, reflecting a 7.5% decline from a year ago. This marks the fifth straight month of decline since October 2021 (-5.8%). It is noteworthy that this is the first time that exports have continued to fall for five consecutive months since the initial outbreak of COVID-19 in March-August 2020.
On the other hand, imports in the previous month increased by 3.6% to 55.4 billion dollars compared to the previous year, mainly due to a 19.7% increase in the import value of the three major energy sources, namely crude oil, natural gas, and coal, which amounted to 15.3 billion dollars. As a result, the trade balance recorded a deficit of 5.3 billion dollars, marking the twelfth consecutive month of the deficit since March of last year. In just two months since the beginning of this year, the trade deficit has accumulated to nearly 38% of the total deficit for last year. It is the first time for the country to experience a 12-month consecutive trade deficit in 26 years, from January 1995 to May 1997.
Despite the bleak trade situation, the government forecast that the semiconductor market will recover in the latter half of this year, which could lead to improved exports.