Trade polarization in Korea, exports to China continue to decline, dividend income to Japan soars
In the Korean economy, the polarization between automobiles and semiconductors has deepened due to a decrease in imports and semiconductor exports, while China's exports continue to decline, and Japan's dividend income soars and exports to the United States increase.
China's National Bureau of Statistics announced on the 8th that 'exports in July' decreased by 14.5% and imports by 12.4% compared to the previous year, while South Korea's exports and imports decreased by 9.3% and imports by 10.2% in June, while automobile imports soared by 75%. lost.
The Bank of Korea announced on the 8th that its current account surplus in the first half of this year had plunged to 1/10 of the size of a year ago.
Japan's current account surplus in the first half of this year was 8.132 trillion yen, up 11.1% from the same period last year.
South Korea's goods account surplus is 3.98 billion dollars, and its service account deficit is 2.61 billion dollars.
South Korea's deficit shrank from $12.58 billion to $9.06 billion as semiconductor exports plunged 28 percent.
The decline in exports fell 40.5 percent in petroleum products, from $5.61 billion to $3.34 billion.
China's exports fell 14.5 per cent year-on-year in July, while imports fell 12.4 per cent year-on-year, customs data showed on Monday.
Regarding China's July economic data, Reuters said, "A poll of economists showed a 12.5% decline in imports and a 5.0% decline, worse than expected." Current account balance statistics, along with indicators of Australian consumer sentiment, weighed heavily on the local economy,” he said.
Korea’s exports have declined year-on-year for the 10th month, and imports have also declined for the 4th month, continuing a recession in which “import declines exceed exports.”
The Korean economy has been completely polarized in exports, with automobiles and ships increasing and semiconductors and chemical products declining.
June statistics showed a clear increase in passenger car exports, up 60.7% from $3.73 billion a year ago to $5.99 billion. Ship exports doubled from $1.21 billion to $2.37 billion ( 96.2%) increased. In addition, exports of all items except machinery and precision equipment (6.09 billion dollars) and automobile parts (1.92 billion dollars) decreased compared to a year ago.
Semiconductor exports decreased from 12.58 billion dollars to 9.06 billion dollars, and the rate of decline continued at 28.0%.
South Korea's exports to Southeast Asia, China, and the United States all decreased. Exports to Southeast Asia decreased by 17.9% from a year ago in June, and exports to China decreased by 19.0% to $10.5 billion from $12.96 billion.
South Korea's exports to the US in June fell 1.8 percent from $9.77 billion to $9.59 billion.
Japan's July exports increased by 2.0% to 47,404.3 billion yen, automobile exports recovered, and exports to the US and other countries increased significantly.
Korea's import growth was driven by passenger cars ($1.84 billion, 75.0%), non-durable consumer goods ($1.96 billion, 3.0%), and direct consumer goods ($2.37 billion, 0.2%), with durable consumer imports increasing by 15.5%. did.
Semiconductor imports fell 19.2% from 6.8 billion dollars to 5.5 billion dollars in June, and information and communication equipment frugalized 17.3% from 2.47 billion dollars to 2.04 billion dollars, coincident with a decrease in major exports.
“Sluggish export performance in China is the latest sign that growth could slow further in the third quarter as construction, manufacturing and services activity, foreign direct investment and industrial profits all weaken,” Reuters said. And Korea's exports to China have declined the most."
Yomiuri said, “The first-line profit and loss balance, including dividends received by companies from overseas subsidiaries, increased by 5.4% to 17,528.6 billion yen, the second largest surplus since 1985.” The balance of payments surplus of 1,508.8 billion yen is three times that of last June and the second largest since 1985,” he said.
Regarding the Chinese economy, Bloomberg announced on the 8th, “In terms of the GDP deflator, another price index in the economics tally, it has already entered deflation (-0.62%) in the first half of this year.”
China will release its Consumer Price Index (CPI) and Producer Price Index (PPI) for July on the 9th.
As a market forecast, Bloomberg said, "Unlike Western countries such as the United States with high inflation, China's July CPI and PPI are expected to fall by 0.4% and 4.0% year-on-year, respectively." It has been positive ever since the month recorded negative, but after recording 1.0% in February this year, it showed less than 1% in March-May, and then recorded 0% in June. From now on, it has always been negative.”
China's economy in June fell 5.4% year-on-year.
This is the fastest rate of decline since the 5.9% plunge in December 2015, and a simultaneous decline in the CPI and PPI growth rates in July seems fatal for Korea.
The Bank of Korea said in its report "China's economic outlook and major issues in the second half of 2023" that "the reopening effect weakened faster than expected in all areas of the economy, including production, consumption, and investment, in the second quarter.", and risk management, etc. will show a gradual recovery as policy support expands," he said on the 6th.