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Ratio of exports to GDP hits new record in Q2

The weight of exports in the South Korean economy hit an all-time high in the second quarter, central bank data showed Thursday, underlining the country’s heavy dependence on overseas shipments for economic growth.

Seasonally adjusted exports of goods and services amounted to 141.7 trillion won ($134.6 billion) in the April-June period, or 52.68 percent of the gross domestic product, according to the Bank of Korea.

The second-quarter reading was higher than 52.2 percent tallied in the first quarter and the highest since the central bank began tracking related data in 1970.

The percentage has been on the rise, indicating that overseas shipments have powered the country’s economy, which expanded for the 10th consecutive quarter in the second quarter.

In the cited period, the portion of consumer spending accounted for 51.5 percent out of the GDP, slightly up from 51.4 percent three months earlier.

But the weight of consumer spending has stayed at near 50 percent since it reached 59.4 percent in the second quarter of 1997, the data showed. The portion of exports surpassed that of consumer spending for the second straight quarter in the April-June period.

Experts point out that heavy reliance on trade leaves South Korea frequently exposed to external risks or fluctuations in global markets.

The government is seeking to boost domestic demand in a bid to reduce the country’s dependence on exports for economic growth. It will lower entry barriers to professional jobs and continue to work to remove regulations barring market creation and fair competition. 

(Yonhap News)
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