Waning demand from U.S. eats into IT exports

Exports of IT products contracted 3 percent on-year last month due to sluggish global economic growth and fewer products shipped to the United States and Japan, the government said yesterday.

The country shipped $12.94 billion worth of IT products in May, compared to $13.35 billion a year earlier, according to the Ministry of Knowledge Economy. However, it posted a trade surplus of $6.57 billion as imports also fell 8.4 percent to $6.37 billion. May’s outbound shipment numbers represent the third month in a row the country’s IT exports have contracted on-year. The ministry said last month’s negative showing comes as weak global economic growth weighed down by persistent euro zone fiscal problems and slower-than-expected growth in the U.S. hurt demand.

It said exports of displays and mobile phones contracted 0.2 percent and 36.7 percent last month to $2.70 billion and $1.55 billion, respectively. TV exports were also down 14.4 percent on-year to $520 million. Outbound shipments of semiconductors, however, moved up 1.7 percent to $4.25 billion, with computers and related equipment jumping 22.5 percent to $670 million. Korea’s IT exports to China, including Hong Kong, as well as to the Association of Southeast Asian Nations and the European Union all increased, although numbers for the United States and Japan fell in the cited month compared to May 2011.

Shipments to China rose 4.8 percent to $6.46 billion, while the country’s exports to Asean and the EU gained 18.9 percent and 1.5 percent, to $1.43 billion and $1.24 billion, respectively.

Imports declined as domestic demand for foreign-made mobile phones and computers fell.

For the first five months of this year, the country shipped out $60.38 billion worth of IT products and imported $31.77 billion for a surplus of $28.61 billion. This is smaller than $30.41 billion in the black posted for the same period last year. The ministry said indications that China will increase investment in its IT sector, coupled with a loss of competitiveness by Japanese and Taiwanese chip and display companies, could boost sales of locally-made products. Yonhap