China, which had been a permanent trade surplus for Korea, has now turned into a country with the largest trade deficit.
According to the Korea International Trade Association’s trade statistics, China became Korea’s largest trade deficit in January, followed by February’s cumulative balance also ranking first in the unrivaled trade deficit. This is the first time that China has become our largest trade deficit on a monthly or annual basis.
It is a very large deficit compared to Japan, Australia, Indonesia, and Malaysia, which have traditionally been Korea’s trade deficits. Compared to the same period last year, exports decreased by 36.2% this month, while imports increased by 9.1%, and the situation is not expected to be much different.
In this situation, experts analyzed the sharp decline in exports due to China’s ‘zero corona’ policy after the pandemic and the sharp rise in prices of industrial raw materials such as imported lithium needed for battery manufacturing as major factors.
More fundamentally, however, we should not overlook the fact that China’s trade structure is changing. has an opinion. In the past, when Korea made intermediate goods and exported them, China processed them and re-exported them.
Of course, there is a high expectation that exports to China will be relatively better due to China’s full-scale reopening (resumption of economic activities), but there are many controversies about the effect.
Experts pointed out, “We need to enhance the competitiveness of new growth industries that require new technology rather than manufacturing, where price competition with China is difficult.”