South Korea exports seen rebounding in H2

SEOUL:South Korea’s exports may rebound in the second half of the year from a falling streak that has lasted more than a year, thanks to recoveries in advanced economies and rising global oil prices, a trade group report said.

Exports from July to December are likely to grow 0.9% from a year earlier, the research arm of the Korea International Trade Association (KITA) said in a mid-year report, compared with an estimated 10.1% drop for the first half of the year.

Shipments have been on a steady decline since January last year on sliding commodity prices and a sluggish global economy.

Earlier this month, the trade ministry said conditions for exports going forward did not look favourable and declined to say whether exports would manage to rise by year-end.

“External factors that have mainly weakened exports in South Korea like low oil prices and a slowdown in growth in China are expected to ease gradually in the second half of the year,” said KITA’s Institute for International Trade.

Exports of display components, machinery, semiconductors and textiles will see improvement, it added, while those of ships, smartphones and cars were unlikely to notch sharp rebounds anytime soon.

Meanwhile, monetary policy tightening in the United States and accelerated competition from emerging economies remain downside risks for Asia’s fourth-largest economy, according to the institute.

Exports dropped at a faster-than-expected pace of 6.0% in May and are likely to be worse this month as 20-day exports notched a 12.8% fall, customs data showed on Tuesday.

Preliminary exports data for June will be released July 1. – Reuters