S. Korean exports tumble for 9th month as world economy cools
SEOUL : South Korea's exports tumbled last month for a ninth consecutive month on sluggish demand from its biggest buyer, China, and depressed prices of computer chips globally, government data showed yesterday.
The bleak data clouded the outlook for Asia's fourth-largest economy as a brewing trade dispute with Japan emerged as a new risk to the export-dependent economy on top of the prolonged conflicts between the US and China.
Exports last month plunged 13.6 per cent from a year earlier, the trade ministry data showed, exactly matching a median 13.6 per cent fall forecast in a Reuters survey and marking the third month with a double-digit rate of drop in exports.
That further dented growth prospects for South Korea and strengthened the case for an additional policy easing by the central bank, soon after a surprise interest rate cut in July, for the first time in three years.
"There's no sign of the export momentum gaining strength as the US-China trade dispute continued while Japan's export curbs and the political unrest in Hong Kong have shaken business sentiment," said Mr Lee Sang-jae, an economist at Eugene Investment and Securities.
South Korea is the first major exporting economy to report foreign trade data each month and its companies include some of the world's top suppliers of chips, smartphones, cars and ships, so providing an early guide to the health of the global economy.
Yesterday, the finance minister also said South Korea was now likely to miss this year's growth target, just two months after the government downgraded the goal to 2.4-2.5 per cent from 2.6-2.7 per cent earlier.
The sluggish exports last month were led by a 30.7 per cent drop in shipments of semiconductor chips that account for a fifth of the total, while a decline of 21.3 per cent in sales to China also contributed, the ministry data showed. - REUTERS
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