Trade Expansion
The Korea International Trade Association announced on January 17 that Korea, instead of Japan, became the second-largest trade partner of China in the fourth quarter of last year. It added that Korea’s trade with China during the period amounted to US$75.6 billion, thanks to the Korea-China FTA and an increase in the export of Chinese IT products to Korea, while the amount of trade between China and Japan totaled US$71.7 billion.
In the last quarter of 2015, Korea’s imports from China increased by 1% from a year ago to US$101.38 billion whereas China’s exports to Japan decreased by 9.2%. This resulted in a decline in Korea’s trade surplus with respect to China. Specifically, the surplus fell US$16.8 billion year on year to US$73.1 billion last year.
In the meantime, Korea’s exports to China decreased 8.2% to US$178.5 billion in that quarter while China’s total imports fell 14.1% and Japan’s exports to China declined 12.2%. Under the circumstances, Korean companies’ share in the Chinese import market reached 10.4%, recording a double digit for the first time. Japanese exporters accounted for 8.5% of the market last year.
In 2015, Korea surpassed Japan for the first time in eight years in investment in China, too. Between January and November, Korea’s investment in China, approximately US$3.7 billion, exceeded Japan’s by a margin of US$700 million. The association explained that the trade and investment between Korea and China are likely to continue to exceed those between Japan and China with the Korea-China FTA in effect.