Exports Marked 11 Consecutive Months Negative Growth

Decreasing rate of exports marked considerably.

The Ministry of Commerce, Industry, and Energy (MCIE) announced yesterday that export in January amounted to $11.52 billion, 8.9 percent lower than the same period last year. Exports marked 11 consecutive months negative growth and declined that last January, which had the lunar New Year holidays. Because this year`s lunar New Year holidays are in February, exports in February are likely to fall. Therefore, while there are signs of economic recovery, the prospects for exports are opaque.

Imports in January totaled $11.34 billion, 8.7 percent less than the same period last year. Thus, the trade surplus in January was $180 million. Capital goods imports fell 16.2 percent, which shows that companies do not invested actively in equipment.

For the total exports, exports in January was far lower than last year`s monthly exports of $12-14 billion and marked the lowest amount since last July.

The MCIE`s Director of Trade and Investment Kim Chil-Doo explained, "Because exports in last year were favorable until February, this January`s increase rate was marked relatively as a negative growth. Exports` decline rate was reduced compare to minus 17.1 percent in last November and minus 19.6 percent in last December."

However, the MCIE changed its prospects for the recovery of exports from the second quarter to the latter half of this year due to the weakening of yen and uncertainties in the Middle East.

The amount of letter of credit (LC), which is a leading composite index of exports, fell by 25.7 percent in last December and 33.2 percent (until January 20) in January over the corresponding periods previous year. It discourages short-term prospects.

Yeon-Su Sin ysshin@donga.com