SEOUL, Dec. 2 (Yonhap) — South Korea’s exports are set to rise 6 percent in 2021 as pandemic-hit economies are expected to gradually recover and demand for chips and IT goods is likely to remain strong, a trade organization said Wednesday.
Outbound shipments are estimated to be valued at US$538.2 billion in 2021, compared with this year’s estimated $507 billion, according to the Korea International Trade Association (KITA).
KITA said imports will reach $490 billion next year, also up 5.4 percent from $465 billion estimated for 2020, resulting in trade surplus of $48.1 billion, rising slightly from this year’s $42.8 estimate.
The association attributed the recovery to the strong demand for chips and IT products amid the boom of the digital economy in the post-pandemic era.
Exports of chips are expected to expand 5.1 percent on-year in 2021 to reach $100 billion. The products account for roughly 20 percent of combined outbound shipments.
Mobile devices and electronics, on the other hand, are expected to fall 9.8 percent and 3.3 percent, respectively, due to enhanced competition with China.
Overseas sales of automobiles and auto parts are to expand 11.9 percent and 16.2 percent, respectively, on-year in 2021, according to the KITA report, led mostly by strong demand for eco-friendly cars and sports-utility vehicles.
The recovery of crude price will lead to 11.4 percent and 23 percent increases in outbound shipments of petrochemicals and petroleum goods.
Despite the rosy perspective, the association said the prolonged discord between the United States and China, and a possible resurgence of new virus cases, still pose threats to exports.
In November, South Korea’s exports rebounded 4 percent on-year in the latest sign of a possible recovery down the road.
Outbound shipments dipped more than 10 percent on-year in 2019, due to a slump in the global chip market coupled with the trade feud between the world’s top two economies.
While the country’s exports posted the first on-year increase in 14 months in February, the COVID-19 pandemic, which has haunted the global economy, has dashed hopes for an annual recovery.
Exports fell a whopping 25.6 percent in April, followed by another crash of 23.8 percent in May.
After extending that slump to a sixth month in August, they rebounded 7.3 percent in September, but edged down 3.8 percent in October.