Exports keep growing, but so too do imports

Exports last month grew 21.3 percent year-on-year to $61.5 billion, the second-largest monthly figure after March's record $63.5 billion.

Export cargo at a pork in Busan on Wednesday. Korea's export grew to its second-largest in May. However, as import grew at a faster pace, itrade recorded a deficit.[YONHAP]

Korea continued to enjoy robust export growth in May but imports climbed too due to higher costs caused by the Russia-Ukraine war and global supply chain disruptions.

According to the Ministry of Trade, Industry and Energy on Wednesday, exports last month grew 21.3 percent year-on-year to $61.5 billion, the second-largest monthly figure after March’s record $63.5 billion.

Export have grown year-on-year for 19 consecutive months and at a double-digit rate for 15 straight months.

This is Korea's third-longest export growth streak.

Imports last month grew 32 percent to $63.2 billion compared to the previous year, the third consecutive month in which imports exceeded $60 billion.

It was the sharpest year-on-year increase since 40.9 percent in June 2021.

Imports have been growing for 12 consecutive months.

In May, Korea recorded a $1.7 billion trade deficit, the second monthly deficit in a row. In April, the deficit was $2.5 billion. A year ago, Korea reported a $2.8 billion surplus.

The rise in imports was largely driven by higher commodity prices including crude oil prices.

Imports of the three energy resources -- crude, gas and coal -- amounted to $14.8 billion last month, an 84 percent increase compared to a year ago.

Crude imports last month amounted to $8.8 billion, up 65 percent year-on-year, while gas imports amounted to $3.1 billion, up 74 percent, and coal $2.8 billion, a 234 percent surge.

Among exported goods, petroleum goods surged 107 percent to $6.4 billion last month, exceeding $6 billion for the first time.

The previous record was March's $5.5 billion.

Petrochemical good exports rose 14 percent of $5.2 billion.

Semiconductor exports, Korea’s biggest export item, grew 15 percent to $11.5 billion.

Chip exports have been growing for 23 consecutive months. In 13 months, exports were over $10 billion.

Automobile exports grew for the second consecutive month in May, largely due to the base effect, which means the figure for last May was low because a shortage of computer chips affected car production.

Automobile exports grew 18.9 percent year-on-year to $4 billion.

While exports to major regions including the U.S. continued to grow, exports to Russia and Ukraine suffered.

Exports to Russia shrunk 59.4 percent while exports to Ukraine dropped 80.7 percent.

The U.S., which is Korea’s second-largest trading partner, continued to import a lot of Korean goods. Exports to the U.S. grew 29 percent in May to $9.6 billion.

Exports to other regions also grew at double-digit rates including to the EU, which increased 23.6 percent to $6 billion; to Asean, which grew 23 percent to $10.6 billion; and to Japan, which grew 19.9 percent to $2.6 billion.

Exports to South America were up 32.5 percent to $2.7 billion; to India, up 70.3 percent to $1.7 billion; and to the Middle East, up 48.8 percent to $1.6 billion.

While exports to Korea’s biggest trading partner, China, rose, it was only by 1.2 percent to $13.4 billion.

The government’s Zero Covid policy and lockdowns were blamed. Despite the lockdowns, exports of Korean semiconductors, petrochemical goods and mobile telecommunication devices grew year-on-year.

Exports of semiconductors rose 10.5 percent; of petrochemical goods 12.4 percent; and of mobile telecommunication devices 65 percent.

“In May, we achieved our second-largest exports of $61.5 billion after March,” said Lee Chang-yang, Minister of Trade, Industry and Energy. “The accumulated exports in the first five months amount to $292.6 billion, which is an all-time record.”

However, he noted headwinds including rising commodity prices and trade deficits.

“Recently low growth and inflation as well as the instability of supply chain network have created a serious situation for our economy,” Minister Lee said. “In facing such major challenges, we need to increase the competitiveness of our industries.”

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]