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Bank of Korea headquarters in central Seoul. (Yonhap) |
A slowdown in China's economy will have a negative impact on South Korea's exports but its fallout could be eased thanks to strong demand for Korean-made chips, a central bank report showed Wednesday.
China's economy is showing signs of slowing down, with its growth rate falling to 4.9 percent on-year in the third quarter from 18.3 percent and 7.9 percent in the first and second quarters.
A recent debt crisis of a major Chinese property developer has also clouded the outlook for China's economy.
"It would be inevitable that a slowdown in China's economy will have a negative impact on our exports but global demand for semiconductors closely linked to our shipments to China and China's robust exports will likely ease the negative impact on its domestic demand," the report by the Bank of Korea said.
The report said that South Korea has excelled in exporting chips, petrochemical, machinery and steel products to China, and in particular, semiconductors made up 31.2 percent of its sales in the country in 2020, much higher than 15.1 percent in 2010.
The Chinese market, however, will not likely bolster South Korea's exports, as foreign companies, including Korea's, are relocating their factories to Southeast Asia, India and other countries amid rising labor costs, a deepening Sino-US rivalry and Beijing's increasing self-sufficiency in value-added areas, according to the report. (Yonhap)
