Trade surplus reaches record $41.7b in 2010

Korea’s trade surplus reached a record $41.7 billion in 2010 as locally made products made solid inroads into overseas markets, a government report showed Saturday.
The annual tally showed exports surging 28.6 percent on-year to $467.4 billion, with imports moving up 31.8 percent to $425.7 billion, the Ministry of Knowledge Economy said.
The favorable trade balance for last year surpasses the previous record of $40.4 billion reported for 2009 as the country struggled to cope with the global financial crisis that hurt both exports and imports, the ministry said.
The export tally is also the highest for a one-year period reflecting the competitiveness of Korean products in the international market. The past high was reached in 2008, when outbound shipments topped $422.0 billion.
Korea, in addition, became the ninth-largest trading nation in the world in 2010 by moving up one notch past Belgium, while becoming the seventh-biggest exporter by surpassing Italy and trailing France.
On average, the country sent out $1.7 billion worth of products per day in 2010, up 29.5 percent from $1.3 billion reached in the previous year.
The latest report showed exports being led by semiconductors and automobiles that jumped 63.3 percent and 39.3 percent on-year, respectively.
Exports of consumer electronics, steel and ships all gained by double digits with overseas demand going up by more than 30 percent vis-a-vis the year before to places such as Latin America, China and the Association of Southeast Asian Nations.
Shipment gains to the United States soared 32.7 percent, with numbers for Japan and the European Union going up 29.7 percent and 15.3 percent during the year.
Of all outbound shipments, those headed to developing economies made up 71.8 percent of the total, up from 71.2 percent reached in the previous year. Dependence on emerging markets had been one reason why Korea was able to overcome the recent global financial crisis that hurt development industries more than developing countries.
“Last year’s trade is significant because not only were record numbers reached in terms of trade surplus and exports, but local companies were able to expand the global market shares in areas such as mobile communications, semiconductors, autos, petrochemicals and general machinery,” said An Byung-hwa, head of the ministry’s export-import division.
He added that the gains made in the face of appreciation of the Korean won highlighted the level of competitiveness of locally made goods. The Korean currency traded at an average of 1,157 won to the U.S. dollar last year, up from 1,276 won in 2009.
An said geopolitical risks caused by North Korea and concerns stemming from the financial crisis in some European countries did not seriously affect Seoul’s trade performance.
On imports, a rise of energy prices, such as the cost of crude oil, and commodities needed for business investment contributed to gains rising by more than 30 percent.
Commodities imports rose 34.5 percent, with capital and consumer goods moving up 28.8 percent and 29.4 percent, respectively, thanks in part to Korea’s economy expanding by around 6 percent annually. Crude imports rose 35 percent vis-a-vis 2009, with natural gas and machinery needed to make semiconductors moving up 27.3 percent and 180.4 percent, respectively.
In the new year, the ministry in charge of the country’
industrial and trade promotion policies said exports may grow 9.8 percent on-year to $513.0 billion, with imports gaining 14.6 percent to $488.0 billion for a two-way trade volume of over $1 trillion for the first time ever. The country’s trade surplus, however, may dip to $25 billion, as international crude oil prices could go up.
Only the United States, Germany, China, Japan, France, Italy, Britain and the Netherlands have reached total trade volume topping $1 trillion on an annual basis.
The forecast is based on predictions that the global economy should grow by about 4 percent annually.
The ministry’s latest trade report, meanwhile, showed that for December, Korea’s exports jumped 23.1 percent on-year to $44.3 billion, with imports gaining 23.3 percent to $40.5 billion for a favorable balance of $3.7 billion. (Yonhap News)