Despite ongoing disparities in Korea’s export market concerning China’s business blackballing tactics and continued ambiguity regarding the Korea-US Free Trade Agreement, the BSI for the export industry reached 84 points last month, according to the Bank of Korea’s Business Survey Index on Monday.
The index shows that the export industry outperformed domestic companies by nine points.
The BSI is an economic indicator compiled to grasp business conditions for the current month and the outlook for the upcoming month via business surveys. A reading above 100 means that more companies expect business conditions to improve rather than decline.
The BSI for the export industry this year has continued to outperform the BSI for domestic companies. The index difference between export and domestic companies jumped from 5 points in April to 10 in May. The index difference went on to reach 11 points in June and 10 in July.
The BSI difference between exporters and domestic companies from January to August this year was on average 8.4 points a month, which is the highest level in nine years since the average monthly rate of 9.3 points in 2008.
In its survey, the Bank of Korea classified 1,800 manufacturers as exporters and domestic companies. Export companies included electronics firms and shipbuilders, while domestic companies included those related to food products, beverages, timber and wood.
Despite Korea’s exporters outperforming domestic companies this year, the country’s exports have dropped over the past 10 days.
A separate set of data released by the Korea Customs Service on Monday showed that the country’s exports fell 8.7 percent in the first 10 days of this month, compared to a year earlier.
According to the Korea Customs Service, exports totaled $12.3 billion from Sept. 1 to Sunday, down from $13.5 billion in the same period last year. The data suggests that the drop was the result of having seven business days during the 10-day period compared to last year’s eight days during the same period.
The country’s semiconductor industry has been continuing its surge, as exports rose 42.9 percent on-year, while exports of petroleum products rose 15 percent and vehicles increased 13.7 percent.
Amid Beijing continuing economic retaliation against Korea’s deployment of the US’ Terminal High Altitude Area Defense system, exports to China fell 2.8 percent during the 10-day period.
The data also showed that exports to the US dropped by 5.2 percent.
By Julie Jackson (email@example.com