Intermediate goods supply from South Korea to the ASEAN is expected to increase in the wake of COVID-19, trade disputes between the United States and China and Japan’s export curbs targeting South Korea.
As of 2015, China accounted for 14.5 percent (US$18 billion) of the total intermediate goods supply to the ASEAN, followed by Japan (10.8 percent, US$13.4 billion) and South Korea (6.1 percent, US$7.7 billion). When it comes to Cambodia, Laos, Myanmar and Vietnam, South Korea’s supply amounted to as high as 17.2 percent.
The Korea Institute of Finance said on Feb. 27 that the China-led global supply chain has weakened due to the spread of the virus and the trade disputes and this can be South Korea’s opportunity in the ASEAN.
In 2015, intermediate goods supply to Cambodia, Laos, Myanmar and Vietnam from the other ASEAN countries accounted for 28.3 percent (US$580 million) of their intermediate goods imports. China, South Korea and Japan followed them with 20.6 percent (US$424 million), 17.2 percent (US$350 million) and 10.9 percent (US$109 million), respectively.
“When it comes to intermediate goods supply for finished product exports, the ASEAN and the three Northeast Asian countries are very closely interrelated,” the institute explained, adding, “South Korea’s market penetration can be accelerated in Cambodia, Laos, Myanmar and Vietnam in particular.”