Exports to China recover in March

South Korea’s exports to China have been showing signs of recovery in March, as the two nations reel from the impact of the coronavirus outbreak, data from the government and the industry showed Tuesday.

Korea’s daily exports to China for the period of March 1-10 reached $436 million, a 20.8 percent increase compared to the same period in February this year.

Korea’s daily exports to China, however, was still 8.2 percent lower than that of the same period in last year at $475 million.

This year, Korea’s daily exports had peaked in the fourth week of January, marking $530 million. But the figure plunged to $348 million in the first week of February due to the rapid spread of COVID-19 in the neighboring country.

The exports started to pick up starting in the second week of February, when daily exports to China reached $376 million. The figure continued to increase to mark $399 million in the third week and $464 million in the fourth week.

Korea’s automobile companies are also picking up after the temporary shutdown of production lines in February, caused by a supply shortage of wiring harnesses from China.

Korea’s largest automaker Hyundai Motor had to suspend production lines for 10.6 working days, and its sister company Kia Motors had stopped production lines for 8.9 days. SsangYong Motor also went idle for 8.5 days.

In March, the local automobile assembly lines started to operate normally, pumping up operation rates from 57 percent of last month.

To support the auto industry here, the Korean government plans to cut consumption tax by 70 percent on automobile purchases between March and June.

Semiconductor exports to China, another key export item of Korea, remained unaffected amid the rapid spread of the coronavirus.

A government official said that Korea’s overall exports are also expected to regain upward momentum, backed by the recent recovery in the nation’s exports to China. Last year, Korea’s shipments to China accounted for 25.1 percent of all its exports.

However, export sectors are carefully watching developments concerning the novel coronavirus in other major export destinations, including the US and Japan, which could see Korea’s exports dip further.

Korea’s combined exports to the US, China and Japan in 2019 marked 43.8 percent of the total.

By Shim Woo-hyun (ws@heraldcorp.com)