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Graphics by Song Ji-yoon According to Pulse by Maeil Business News Korea, South Korea’s exports recorded a double-digit growth that was led by semiconductors and automobiles in April 2024. According to data released by the Ministry of Trade, Industry and Energy MOTIE on Wednesday, Korea’s exports rose 13.8 percent on year to $56.26 billion in April 2024. It is the seventh consecutive month of growth since the country’s exports turned positive for the first time in 13 months in October 2023. The driving forces behind this growth were automobiles and semiconductors. Korea’s exports of semiconductors totaled $9.96 billion in April 2024, up 56.1 percent from the same period a year ago, a sixth consecutive month of growth and the second largest for April on record. Automobile exports totaled a record $6.79 billion, up 10.3 percent from the same period a year ago and surpassing the previous record high of $6.53 billion in November 2023. “The increase was driven by exports of internal combustion engine vehicles and hybrid cars,” Choi Woo-seok, head of MOTIE’s trade and investment office, said. Thirteen of Korea’s 15 main export items, including semiconductors and automobiles, improved on their performance compared to a year ago. All four major information technology IT items - semiconductors, displays, computers, and wireless communication devices - posted positive growth for two consecutive months in April, with a combined export value recording the highest growth rate in 2024 of 46.6 percent. Outbound shipments of displays rose 16.3 percent to $1.43 billion, while those of ships increased 5.6 percent, marking a ninth consecutive month of growth. Exports of secondary batteries, however, fell 20.1 percent, and steel exports were down by 5.7 percent. By country, exports to the United States hit a record high of $11.4 billion in April 2024, increasing 24.3 percent from a year ago, while exports to China totaled $10.5 billion, up 9.9 percent. China was traditionally Korea‘s largest export destination for decades, but the United States has now emerged as the country’s largest export market on a monthly basis in 2024. The reversal occurred in December 2023 for the first time in 20 years, and exports to the United States continued to surpass those to China from February to April 2024. The increase in exports to the United States is attributable to the booming U.S. consumption, which has led to an increase in exports of automobiles, Korea’s main export item, and the U.S.’ growing demand for advanced semiconductors for artificial intelligence AI servers. By product, automobiles accounted for $3.01 billion in exports to the United States in April, up 41.6 percent. Exports of general machinery, including excavators, also increased by 36.3 percent to $1.26 billion as the U.S. expands its domestic factory capacity. Semiconductors exports also soared 364.4 percent to $570 million. “Korea increased its exports of low-power, high-capacity, and high-value-added memory chips, mainly for AI servers, as many U.S. companies such as Amazon.com, Inc., Microsoft Corp., and Google LLC imported DRAM from Korean companies,” MOTIE trade investment policy officer Jo Eek-no said. On the other hand, exports to China lagged behind the United States in terms of growth, although exports of semiconductors grew by 26.5 percent to $9.52 billion. “Most of the semiconductors exported to China are for general servers,” according to Jo. “As China‘s economy continues to slump and companies are moving their factories from China to Vietnam due to the ‘de-China’ phenomenon, Korea’s intermediate goods exports are also shifting to Vietnam,” Yang Jun-sok, a professor of economics at the Catholic University of Korea, said. “This is the result of a combination of changes in the global geography and China‘s improved technology for producing intermediate goods, which saw it reduce imports from Korea.” He added that this phenomenon could potentially be prolonged due to structural changes. By Hong Hae-jin and Yoon Yeon-hae Copyrights Pulse by Maeil Business News Korea. All Rights Reserved. Source: Pulse by Maeil Business News Korea May 2, 2024

According to Yonhap News, Global credit appraiser S&P Global Ratings said Tuesday it has maintained its credit rating on South Korea at "AA," with a stable outlook. S&P has kept South Korea's long-term sovereign credit rating at the third-highest level on the company's table since August 2016, when it upgraded the rating by one notch from "AA-." "The stable rating outlook reflects our expectation that South Korea will maintain average growth rates that are higher than most other high-income economies for at least the next three to five years," the agency said in a report. S&P expected the South Korean economy to grow 2.2 percent this year, accelerating from last year's 1.4 percent gain. "Over the next three years, real gross domestic product GDP growth should be sustained at levels close to or above 2 percent annually," the agency said, adding that both exports and domestic demand "should strengthen from last year." The forecast was on a par with the growth outlook by the South Korean government and the Organization for Economic Cooperation and Development. The Bank of Korea forecast 2.1 percent growth, and the International Monetary Fund presented a 2.3 percent expansion. Exports, a key economic growth engine for South Korea, rose for the sixth consecutive month in March after a yearlong downturn, driven by solid global demand for semiconductors. The agency also forecast that inflation would narrow to 2.6 percent for 2024 from last year's 3.6 percent, which "should allow interest rates to decline from levels in 2023." Retail prices have been trending down, but inflationary pressure has eased at a slower-than-expected pace due to the high prices of fruit, farm produce and energy. As for public finances, the agency expected the government deficit could rebound to 1 percent of GDP this year due mainly to weaker revenue collection stemming from relatively weak economic growth last year. "Geopolitical risks continue to weigh on the sovereign ratings on South Korea. However, we do not believe that recent developments in the Democratic Republic of Korea North Korea have materially increased the risks of a serious economic or security event on the peninsula," the report read. graceoh@yna.co.kr Source Text Copyrights Yonhap News. All Rights Reserved. Reprint or redistribution without permission is prohibited. Source: Yonhap News April 30, 2024

Photo by Kim Ho-young According to Pulse by Maeil Business News Korea, The South Korean government is expected to establish a special law that allows small business owners without familial successors to sustain their innovations and technologies via mergers and acquisitions M&As. The Ministry of SMEs and Startups on Monday unveiled a package of five strategies and 17 initiatives to support small companies, including a measure designed to help small business owners ensure the sustainability of their workforces and productivity. In many cases, SME owners often end up shutting down their firms as they have no family or relatives to carry on the business. “In Japan, the government actively promotes M&A succession for small companies, given that one-seventh of profitable SMEs opt for closure due to familial succession difficulties,” said Minister of SMEs and Startups Oh Young-ju. The ministry’s package also outlines various policies to bolster the number of innovative SMEs and startups across advanced manufacturing, energy, artificial intelligence AI, and other high-performing sectors to 100,000 by 2027, up from the current 70,000. Innovative SMEs will receive regulatory and financial support. For instance, the policy financing allocated to SMEs that venture into new sectors will surge from 53 percent to 70 percent out of the total financing by 2027. Kim Dong-eun and Han Yubin Copyrights Pulse by Maeil Business News Korea. All Rights Reserved. Source: Pulse by Maeil Business News Korea April 30, 2024

According to Yonhap News, South Korea's industry ministry said Monday it has reached an agreement with Oman to resume a bilateral meeting on economic cooperation that has been stalled due to the COVID-19 pandemic. Trade Minister Cheong In-kyo discussed the agenda with Ali bin Masoud al Sunaidy, the head of the Oman Public Authority for Special Economic Zones and Free Zones, in Seoul, according to the Ministry of Trade, Industry and Energy. The two countries had scheduled the sixth meeting of the Korea-Oman Economic Cooperation Committee in Muscat in 2019, but the event was postponed due to the global outbreak of the COVID-19 pandemic. During the visit, the Omani official noted that the Middle East nation wishes to resume the meeting in line with his government's efforts to diversify its industrial portfolio, including the renewable energy sector. Cheong said South Korea wishes to explore ways to boost investment between the two countries and find new business opportunities by organizing the meeting at an early date. He also asked for the Omani government's proactive attention on South Korean companies' plan to participate in the Middle Eastern nation's solar power, green hydrogen and petrochemical projects. colin@yna.co.kr Source Text Copyrights Yonhap News. All Rights Reserved. Reprint or redistribution without permission is prohibited. Source: Yonhap News April 29, 2024

Photo by The Korea Federation of SMEs According to Pulse by Maeil Business News Korea, The Korea Federation of SMEs KBIZ and the National Federation of Small Business Associations in Japan have agreed to expand exchanges between the small and medium-sized enterprises SME of both countries, KBIZ said on Sunday. The agreement was made during a meeting that took place on Friday at the KBIZ headquarters in Yeouido, Seoul. The Japanese delegation led by the association’s chairman Hiroshi Mori was in response to KBIZ’s visit to its counterpart in Japan in October 2023. Both organizations expressed an understanding of the importance of economic cooperation between South Korea and Japan and discussed various measures to enhance private-sector exchanges. In particular, they agreed to expand exchanges between SME associations by sharing common policies and issues faced by SMEs in both countries, including cooperative negotiation systems and business succession schemes. Before the meeting, the Japanese delegation visited Home & Shopping established to support SMEs to assess the competitiveness of excellent SME products and acknowledged the need for support for these enterprises. KBIZ Chairman Kim Ki-moon emphasized the complementary strengths of Korea in information and communication technology ICT and Japan in core technologies such as materials, components, and equipment. He said that active mutual exchanges are necessary to achieve tangible results between SMEs in both countries and called for concrete exchanges and the dissemination of outcomes through a memorandum of understanding. Chairman Mori expressed his pleasure at visiting Korea to discuss detailed cooperation since October last year. He emphasized the need for frequent meetings between the two organizations representing SMEs in Korea and Japan to establish directions for cooperation that are beneficial to each other and strive to achieve results together. By Kim Dong-eun and Minu Kim Copyrights Pulse by Maeil Business News Korea. All Rights Reserved. Source: Pulse by Maeil Business News Korea April 29, 2024