As annual exports of Korean health care and cosmetics goods surpassed the US$10 billion (11.45 trillion won) mark for the first time in 2016, the balance of trade has turned into a surplus. In particular, exports of cosmetics products surged more than 40 percent on-year.
According to a report titled “Healthcare Industry Exports and Business Performance in 2016” released by the Ministry of Health and Welfare on June 29, outbound shipments of locally produced drugs, medical equipment and cosmetics reached US$10.22 billion (11.9 trillion won) last year, up 19.1 percent from the previous year. South Korea saw an average annual export growth of 19.4 percent between 2012 and 2016. The nation’s imports stood at US$10.11 billion (11.8 trillion won), which is US$100 million (114.58 billion won) lower than exports.
The cosmetics sector showed the highest increase in exports. Exports of cosmetics products surged 43.1 percent on-year to US$4.2 billion (4.9 trillion won) last year. China was the biggest buyer of South Korean beauty products. Exports to China increased 33 percent on-year to US$1.5 billion (1.72 trillion won) last year, accounting for 37.6 percent of overseas sales. Exports to Hong Kong and the United States also grew 81 percent and 45.6 percent to US$1.2 billion (1.37 trillion won) and US$300 million (343.69 billion won), respectively.
Exports of medicine recorded at US$3.1 billion (3.6 trillion won) last year, up 5.7 percent from the previous year, reaching a record high. The jump of medicine exports was largely due to increased outbound shipments of local biosimilars to European countries. Exports of biosimilars to Croatia and Ireland stood at US$400 million (458.16 billion won) and US$230 million (263.44 billion won), showing a whopping 355.9 percent and 192.4 percent growth, respectively. Exports of raw material medicine also increased 8.4 percent on-year to US$1.4 billion (1.6 trillion won). In particular, the number of local companies that export high-quality raw material medicine to global multinational pharmaceutical firms, such as Yuhan Chemical, ChongKunDang BiO and Kyongbo Pharm, rose.
Exports of medical equipment grew 7.7 percent on-year to US$2.9 billion (3.4 trillion won). The U.S. was the biggest buyer of South Korean-made medical equipment with US$500 million (572.35 billion won), followed by China with US$440 million (503.67 billion won) and Germany with US$250 million (286.18 billion won). Exports to the United Arab Emirates and China also increased 51.5 percent and 34.3 percent, while exports to Vietnam and France rose 30.7 percent and 14.8 percent, showing a double digit growth. By item, ultrasonic diagnostic equipment ranked top in terms of exports with US$520 million (595.4 billion won), followed by dental implant with US$180 million (206.05 billion won) and soft contact lens with US$150 million (171.65 billion won). Notably, exports of tissue restorative bio-materials grew as much as 73.5 percent.
Medicine showed the highest increase to US$5.5 billion (6.4 trillion won) in imports last year, up 13.9 percent from the previous year. Imports of medical equipment rose 7 percent to US$3.15 billion (3.7 trillion won), while imports of cosmetics products increased 2.7 percent to US$1.46 billion (1.7 trillion won).
Meanwhile, the number of healthcare companies listed on the stock market was 175 last year and these companies showed the rate of increase in sales at 12.5 percent, rate of operating profits at 11.3 percent and rate of increase in R&D costs at 20.4 percent, recording a higher growth than the average of all listed manufacturing businesses. Four companies – Yuhan Corporation, Green Cross, AmorePacific and LG Household & Health Care – made the list of firms with sales of 1 trillion won (US$873.52 million). Especially, Yuhan Corporation and Green Cross had achieved annual sales of more than 1 trillion won (US$873.52 million) for two years in a row from 2015. AmorePacific saw its annual sales surpass 4 trillion won (US$3.49 billion) last year, while LG Household & Health Care saw its annual sales exceed 3 trillion won (US$2.62 billion), showing a steady growth.