Too Much Inclined
According to a report “Mythology of Semiconductor Exports and Cross-national Comparison of Export Competitiveness” released by the Korea International Trade Association (KITA) on September 13, semiconductors accounted for 16 percent of the country’s total exports.
In particular, the KITA said South Korea's semiconductor exports are expected to exceed US$90 billion (101.5 trillion won) this year, which is much higher than last year. This is because outbound shipments of computer chips surged 52 percent on-year to US$59.5 billion (67.15 trillion won) from January to August this year.
This year, semiconductors took up nearly half of the nation’s total trade surplus, contributing to maintain a stable international balance of payments. In particular, computer chips maintained the number one spot in terms of export item 21 times after 1992. A semiconductor, which is a technology intensive product, plays a crucial role in raising South Korea’s national credit rating and improving the competitiveness of its IT products.
South Korea has a 57 percent share in the global memory semiconductor market as of 2016, maintaining the dominant position. Taking a look at Revealed Comparative Advantage (RCA), South Korea is improving the technical skills of memory semiconductors along with China and Taiwan. However, the export similarity index between South Korea and China rose, while that between South Korea and Japan and that with the US each dropped. In short, the technological gap between South Korea and China rapidly decreased.
The report said that the country has made "pre-emptive" investments in research and development to raise its technical levels and secured the export market with efficient semiconductor production. This has helped drive up the demand for Korean chips and boosted chipmakers' bottom line. In addition, the export price of DRAM chips had been more than doubled from US$1.54 (1,743 won) per unit in 2002 to US$3.45 (3,906 won) in July this year. This is largely due to the fact that South Korea has developed advanced semiconductor technologies.
Moon Byung-ki, a senior researcher at the KITA, said, “The number of South Korea’s semiconductor patents is on the decrease, while China is making massive investment in the semiconductor sector. The industry should continuously make investment in system semiconductors as well as memory semiconductors and create a new growth engine through the partnerships with the academic community and the government in the future.”
Korea’s ICT Exports Hit Another Record High in Aug.
Amid semiconductors leading the nation’s total exports, the exports of information and communication technology (ICT) products amounted to US$17.49 billion (19.6 trillion won) in August, hitting an all-time high for seven months in a row, according to a report titled “Trend of ICT Imports and Exports in August” from the Ministry of Science and ICT on September 13,
The figure was up 23.9 percent from a year earlier and increased for the tenth straight month after November 2016 and recorded a two-digit growth for the ninth consecutive month.
By item, exports of semiconductors stood at US$8.93 billion (10.02 trillion won), reaching the highest monthly figure boosted by rising demand of system semiconductors including the memory semiconductor and foundry sectors.
In addition, exports of displays increased 10 months in a row to US$2.8 billion (3.15 trillion won), while overseas shipments of computers and computer equipment totaled US$870 million (901.1 billion won) on the back of record-high shipments of South Korean-made solid state drives worth US$540 million (563.2 billion won).
By region, shipments to China, Vietnam, the United States and the European Union amounted to US$9.1 billion (10.25 trillion won), US$2.2 billion (2.48 trillion won), US$1.77 billion (1.92 trillion won) and US$860 million (901.3 billion won), respectively, showing growth in major countries.
Meanwhile, ICT imports, mainly semiconductors, computers and computer equipment, jumped 13.3 percent on-year to US$8.6 billion (9.69 trillion won) last month, with the country logging a trade surplus of US$8.88 billion (9.91 trillion won) in the sector.