South Korea’s exports increased by 4.1% amid US tariff jitters

The market value of the goods under shipment after adjusting for working days in the initial 20 days of this month went up 4.1% compared to last year, according to the customs office. But the record was below June’s, which saw a 6.8% surge.

On the other hand, unadjusted exports decreased by 2.2%, imports went down by 4.3%, and the outcome was a trade surplus of $465 million.

Still, worries about the market outlook for South Korea persisted as it concentrated on the trade deal with the US.

Trump’s tariff rates raise tension among the US trading countries 

Recent records from verifiable sources suggest South Korea’s exports and broader economy show signs of recovery. However, lingering anxiety stemming from Trump’s trade wars—marked by aggressive tariff hikes and a shift toward protectionism—continues to cloud the outlook.

The August 1 deadline for the recently increased tariff rate has also ratcheted up economic tension. South Korea was hit with a 25% tariff by Trump, though it is currently delayed. Tariffs on key industries such as auto and steel remain active. Trump said that semiconductors will also be hit with tariff rates from Aug. 1.

Concerning these tariff threats, US trading countries have rushed to negotiate to be granted an exemption and strike broader trade deals. Seoul is still lagging behind in this due to a long period without strong leadership after it denounced former President Yoon Suk Yeol. 

Meanwhile, South Korea’s trade data arrived as President Lee Jae Myung’s government introduced a supplementary budget of 31.8 trillion won ($23.3 billion) to boost growth and protect the economy from outside threats. South Korea’s economy shrank in the first quarter, prompting the central bank to lower interest rates to 2.5% and reduce its growth prediction to 0.8%. 

The factors behind the country’s impressive economic results included semiconductors, South Korea’s largest export, which recorded a 16.5% increase, and automobile shipments with a 3.9% surge. For steel, it demonstrated a 9.7% decrease, remaining weak under the pressure of the 50% US tariff.

Shipments to the US fell 2.1% and imports decreased 28.4%. Shipments overseas to China fell 5.9% while exports to the European Union rose 3%.

South Korea demonstrated impressive economic growth in June 

Apart from this month, South Korea’s exports likely rebounded in June on robust tech demand after plunging in May, according to a poll from a reliable source. Still, analysts are cautious because of uncertainty over the US tariff policy.

In the same month, shipments from Asia’s fourth-largest economy were estimated to have increased by 4.7% from a year earlier, according to the median of 10 economists surveyed between June 23 and June 26.

Chun Kyu-yeon, an economist at Hana Securities, weighed in on the topic of discussion. The economist stated that sales of semiconductors are better than anticipated, driving the recovery in exports.

To demonstrate the role of semiconductors in South Korea’s economic growth, shipments increased by 21.8%, raising the economic growth by 8.3%.

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