South Korea exports dip as US tariffs outweigh extra working days
The decline underscores the difficult environment South Korean exporters face in a new era of protectionism since Trump took office
[SEOUL] South Korea’s exports declined as the impact of sweeping US tariffs outweighed the benefit of more working days in the month, underscoring the toll of protectionist trade policies in data that also highlighted distortions from holidays.
Exports adjusted for working-day differences fell 6.1 per cent in September from a year earlier. Headline exports climbed 12.7 per cent, following a 1.2 per cent gain in August. Imports increased 8.2 per cent, resulting in a trade surplus of US$9.6 billion.
Wednesday’s (Oct 1) data underscored the calendar impact on business. September featured 24 working days this year, as the Chuseok holiday will be held in October, while there were only 20 official working days in September last year. The shift in working days lifted the monthly total but pulled down the daily average.
The drop follows three months of gains, which officials and analysts attributed to exporters front-loading shipments ahead of US President Donald Trump’s new tariffs. The decline underscores the difficult environment South Korean exporters face in a new era of protectionism since Trump took office.
The data could persuade authorities at the Bank of Korea to consider resuming the monetary easing cycle when they next set policy on Oct 23, weighing the trade picture against risks from household debt levels. Exports were equivalent to more than 40 per cent of GDP last year, and a sharp slowdown would erode one of the economy’s key buffers.
Despite the slowdown, sustained demand for memory chips used in artificial intelligence development has been a key driver of the nation’s economy this year. Semiconductor exports jumped 22 per cent, while autos also gained almost 17 per cent.
By destination, shipments to the US fell 1.4 per cent, declining for a second straight month, reflecting the impact of a 15 per cent universal tariff and a 25 per cent duty on US imports of South Korean cars. Exports to China edged up 0.5 per cent.
Steel has been among the hardest hit sectors, with exports plunging after duties on the metal were doubled to 50 per cent in early June. Petrochemicals also remained subdued on tariffs and weak global demand. BLOOMBERG
Share with us your feedback on BT's products and services
