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According to the Bank of Korea on the 10th, the volume of trade (based on customs clearance) this year is expected to be $1.58 trillion. Exports are estimated to increase by 8.5% from last year to $550 billion, and imports are estimated to increase by 9.5% to $50.8 billion.
Last year, Korea failed to achieve $1 trillion in trade in four years due to the global economic downturn caused by Corona 19. According to the Ministry of Trade, Industry and Energy, in 2020, Korea’s total annual exports amounted to 512.85 billion dollars, succeeding in reaching 50 million dollars for four consecutive years. However, the amount of trade reached 980 billion dollars, a decrease of about 65.4 billion dollars from the previous year. It has been four years since 2016 that the amount of trade has not reached $1 trillion.
The BOK predicted that in 2022, the amount of trade would reach $1.1 trillion, exceeding $1 trillion over two years. In 2022, exports are expected to reach 570 billion dollars and imports will reach 530 billion dollars.
Korea’s trade performance has recovered from the second half of last year. In particular, the past December performance recorded a record high, exceeding the total export of 50 billion dollars and the daily average export of 2 billion dollars. Export performance deteriorated, with exports recorded -20.3% in the second quarter due to the corona 19, but the fourth quarter performance increased 4.2% year-on-year, showing a clear recovery trend thanks to the increase in IT demand such as semiconductors.
In addition to the BOK, organizations that collect trade-related data are also positively evaluating the export prospects this year. The Korea International Trade Association also predicted that this year’s exports increased by 6.0% year-on-year to 5382 billion dollars. KOTRA predicts that it will reach $540 billion-$550 billion, up 6.0-7.0% from last year.
The Hyundai Research Institute predicts that the growth rate of domestic exports will increase significantly from -5.4% in 2020 to 10% in 2021. In particular, in the case of the’double-hit scenario’ (the spread of Corona 19, which is a concern between the beginning of the year and spring of 2021), exports are expected to maintain an increase (around 6%) in 2021.
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On the 8th, Hyundai Economic Research Institute announced ’10 keywords of the Korean economy in 2021′ and cited’improvement of export conditions’ as one of them. As the global economy enters a recovery stance due to the expansion of the vaccine against Corona 19 and the relaxation of protectionism, exports are likely to recover faster than expected due to the expansion of global trade.
By industry, exports of most industries are expected to turn upward, but exports of ICT and automobile industries show a strong recovery trend, and exports of basic intermediate goods (steel and oil) are expected to show a somewhat modest recovery rate.
The Hyundai Research Institute said, “International trade in 2021 is expected to show a recovery trend due to the technological rebound caused by the 2020 recession and the acceleration of economic stimulus policies of major countries.” Regardless of this, it is expected to show a clear recovery trend.”
“The main factor in the recovery of the export economy in 2021 is the base effect on the long-term stagnation in 2019 and 2020, and the strength of stimulus measures in major export markets and the level of economic stabilization resulting from the supply of vaccines are expected to determine the speed of the export economy recovery “He added.