South Korea’s trade volume with China reached $247.3 billion in the first 11 months of this year, rising to the level reached before a diplomatic row over the deployment of an anti-missile system here took a toll on trade between the two countries, government data showed Wednesday.
Korea’s No. 1 export and import market has been China since the South Korea-China free trade agreement was inked in December 2015, accounting for roughly 25 percent of Korea’s trade turnover and about twice the volume with the US, the ministry said.
Korea’s exports to China recorded $150.3 billion and grew 17.2 percent on-year between January and November this year, according to data from the Ministry of Trade, Industry and Energy.
The hike in exports to China was led by semiconductors, petroleum goods and computers, due to the Chinese government’s push to foster its IT and high-tech manufacturing businesses.
By export product, South Korea shipped $48.6 billion worth of semiconductors, followed by $10.8 billion of flat panel displays and $8.6 billion of petroleum goods.
Shipments from China -- mostly made up of direct purchases of computer-related products such as solid state drive, PC and computer screens -- rose 8.6 percent to $97 billion.
“South Korea is seeing an increase in trade volume with China and Vietnam. Trade with China that had dropped to the lowest in 2016 and rose last year has almost recovered to before China’s retaliation over THAAD deployment,” the ministry said. THAAD refers to the Terminal High Altitude Area Defense, a missile defense system of the US that South Korea had agreed to deploy on its land despite China’s vehement opposition.
“Korea’s trade structure largely dependent on China has been complemented by the rise of Vietnam,” added the ministry.
Korea’s $227.3 billion trade volume with China in 2015 slid to $211.4 in 2016, hit by China’s apparent economic retaliation over Korea’s THAAD deployment. It rose back to $239.9 last year, ministry data showed.
Meanwhile, trade with Vietnam also grew 7 percent on-year to $62.6 billion and continued its upward trend, the ministry said.
Vietnam is South Korea’s No. 4 biggest export and import market and No. 1 among ASEAN countries. South Korea clinched a FTA with Vietnam in December 2015.
According to the Trade Ministry, Vietnam is a key production base for Korean companies, as a growing number of companies are choosing to relocate factories from China to Vietnam.
South Korea is the biggest investor there, with $2.8 billion invested there in the January-September period this year, up 24.5 percent on-year and largely centering on high-value goods, such as polypropylene and camera modules, the ministry said.
Due to such trends, Korea’s imports from Vietnam totaled $18.1 billion and jumped 22 percent on-year.
Shipments to Vietnam from Korea increased 1.9 percent on-year to $44.5 billion, after recording a 48.4 percent surge last year.
By Kim Bo-gyung (email@example.com