Korean IT exports decline on year for second month led by chips

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Korean IT exports decline on year for second month led by chips

Published: 16 Sep. 2022, 15:44

A wafer is displayed at Samsung Electronics' showroom in Seocho District, southern Seoul [NEWS1]

IT exports fell 4.6 percent on year to $19.3 billion in August due to sluggish demand, according to the ICT Ministry Friday.

It was the second consecutive on-year decline in monthly IT export volume following the 0.9 percent fall in July, the first drop in 26 months.

Semiconductor exports fell 6.8 percent year-on-year to $11.0 billion, the first drop in this category in 26 months. They were 56.8 percent of total exports in August.

The ministry blamed weak memory chip demand for the decline. Memory chip exports were down 24.7 percent on-year in August to $5.8 billion.

System-on-chip demand stayed strong, with a monthly export volume of $4.7 billion, up 31 percent year-on-year. The figure broke the $4 billion level for the third consecutive month.

Display equipment and parts exports were $2.1 billion, down 5.3 percent on year, and handset exports slipped 3.3 percent to $1.1 billion. Exports of computers and peripherals dropped 25.3 percent to $1.3 billion, with the solid-state drive exports falling 28.2 percent to $970 million.

As the global IT demand slowdown is continuing well into the latter half of the year, analysts are forecasting a steeper decline in smartphone, TV panel and PC sales for the remaining months of 2022.

Omdia adjusted its global smartphone market growth forecast for this year from a 3.7 percent decrease to 6.7 percent. IDC adjusted its forecast for this year's global PC market from the previously expected decline of 8.2 percent to 12.8 percent.

While Korea has run a trade deficit for five months in a row amid rising uncertainty worldwide, hitting a record deficit of $9.5 billion in August, it achieved a trade surplus of $5.8 billion in IT last month. IT product imports were $13.5 billion, up 18.7 percent on year.

IT product exports were 34.1 percent of total exports, staying above the 30 percent mark for six consecutive years.

Korea's IT exports to China, Vietnam, the United States and Japan have all declined due to economic slowdown and production cuts, though the export volume to the EU increased by 4.7 percent helped in part by an increase in sales of vehicle batteries and display panels.

IT exports to China declined 14.4 percent to $8.3 billion dragged down by lockdowns and factory shutdowns in the. Korea's U.S. exports dropped 5.2 percent to $2.3 billion, the second on-year export decline in a row.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]