High energy prices, weak chip demand, China slump behind export fall: finance minister

Finance Minister Choo Kyung-ho speaks during a meeting with economy-related ministers in Seoul on Thursday. [YONHAP]

Korea's extended export slump is attributable to higher energy prices, falling chip shipments and lower demand from China, the finance minister said Thursday.

"When we analyze the latest trade deficits, most of them, roughly 95 percent, are attributable to three elements, namely energy, chips and China," Finance Minister Choo Kyung-ho said ahead of a closed-door meeting with economy-related ministers.

In January, Asia's fourth-largest economy suffered an all-time monthly high trade deficit of $12.69 billion, far higher than the previous record of $9.44 billion set in August last year.

The economy, which relies heavily on imports for its energy demand, has suffered a trade deficit for 11 straight months.

"Due to the slowing global economy, the slump in exports of chips, which take up around 20 percent of our outbound shipments, is intensifying, and we still need to wait for the impact of China's reopening," Choo added. China is the biggest trading partner for Korea.

Choo said the country will continue its efforts to diversify its export portfolio, prop up shipments of agricultural products and take advantage of the popularity of Korean-made entertainment content across the globe.

Yonhap