South Korea’s exports topped expectations in July, as strong global demand continues to underpin the nation’s economy.

Key Points

  • Exports jumped 20 percent in July from a year earlier, a seventh straight double-digit increase and the ninth consecutive gain, data from the Ministry of Trade, Industry and Energy showed. The median estimate of economists was for a rise of 16 percent.
  • Imports advanced 15 percent, matching estimates.
  • The resulting trade surplus was $10.6 billion.

Big Picture

Surging exports and investment have supported Korea’s recovery even as weak consumption at home has limited overall growth. President Moon Jae-in last week laid out policy plans to boost jobs and wages to stimulate domestic activity, and an 11 trillion won extra budget approved last month is expected to help sustain the uptrend for Asia’s fourth-biggest economy.

Exports are projected to continue growing during a sustained recovery in global trade, but downside risks include the possible spreading of trade protectionism, the U.S. Federal Reserve reducing its balance sheet and falling oil prices, the trade ministry said. The U.S. has formally requested talks on revisiting a trade deal that came into force in 2012, amid tensions with the Trump administration over trade.

Economist Takeaway

  • Export growth will slow in the second half of the year to high single-digit rates, partly due to a base effect, but the deceleration shouldn’t be cause for concern, said Park Sang-hyun, the chief economist for HI Investment & Securities in Seoul.
  • “Pressure from the U.S. regarding trade will likely increase, but aggravation of the situation could also cause side-effects for the U.S., so we believe the impact won’t be too strong,” said Lee Sangjae, an economist at Eugene Investment & Securities.


  • Shipments to the U.S. rose 7 percent, while those to China increased 6.6 percent and those to Asean nations grew 32 percent.
  • Exports to India surged 79 percent in July as Korean products gained price competitiveness after the implementation of a goods and services tax in India.
  • By industry, exports of ships more than tripled, while semiconductors rose 58 percent.
  • Shipments of telecommunications devices fell 27 percent and those of home appliances dropped 30 percent.