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South Korea’s Trade Surplus in IT Sector Increases Ten-fold

Tuesday, December 3rd, 2013

According to the ministry, the IT export business numbers have grown about 12 percent on a yearly basis during the last few years. The numbers of exports have risen up to $14.52 billion. Imports have also not been lagging far behind, show­ing a good standard growth and rising this year by about 2.2 percent on a year-by-year basis, coming to about $6.66 billion this year.
The trade surplus regarding infor­mation technology has come to about $7.86 billion, which is in fact higher than South Korea’s surplus of all other trades combined. The total surplus of South Korea in November was calcu­lated at $4.48 billion, while total export numbers in the country grew by 3.9 percent, amounting to $47.8 billion. The import numbers have shown an in­crease of 0.7 percent, reaching $43.32 billion.
In South Korea, the Ministry of Knowledge Economy has further attrib­uted the rise in the surplus in the trade of information technology to the large amounts of exports of semiconductors, mobile phones and other electronic gadgets. The shipment of handsets has brought in a 23.5 percent jump in the lump sum amount of $2.32 billion.
The outgoing shipments have also raked in large amounts of money at an increase of about 12.9 percent, gener­ating $4.6 billion for the Korean econ­omy. Export numbers to China have also increased at a rate of $21.8 per cent, thus amounting to about $7.55 billion.
Export numbers of consignments to other countries have shown significant growth too. The exports to Southeast Asia have brought in some very high increases of about 19.9 percent, fetch­ing about $1.64 billion. Exports to the unions on the European continent are not too far behind, with about an 18.8 percent annual increase. That amounts to about $13.1 billion in revenues.
The Ministry of the Knowledge Economy further added that the scenario of the ex­ports with respect to electronic and infor­mation technology is looking very bright nowadays, and it is to go further uphill. This is owing to the fact that the amount of sales of display panels and semiconductors have shown terrific results. The recovering demand in the United States of America for the need of more and more television sets which are immensely popular all over the world has contributed. South Korea’s self made converging technologies and their terrific reports outside the country have brought this peak in trade. Thus South Korea’s economy was boosted and thus showed signs of improvement in November.
The robust economy was already boom­ing when the IT surplus had hit a record high and that brought the soaring of the industrial productions for a period of two months to date. Thus the current surplus of the South Korean economy, which is the best measurement of the country’s trade numbers comparable with all the other countries that engage in the same indus­tries, has been calculated at $6.88 billion in November of 2012, at that time a record monthly amount. This compared with the relatively modest amount of $4.34 billion earned in November of 2011. This has gone well over the predicted range of the Bank of Korea’s forecast. Thus it has also been able to lend solid support to the won, which had been an excellent performing currency of Asian countries in 2012.
Expectations are made to be broken, and this year indeed it holds true. The produc­tion of the IT industry rose at a faster pace than previous records and also for a third time consecutively in November, thus set­ting benchmarks in the fourth largest economy of the Asian continent. Thus the South Korean economy has indeed struck back with a rebound after three consecu­tive dips in export outputs. This has helped South Korea to post a modest surplus every single month despite some minor hindranc­es. From January to November 2012 South Korea had run a huge IT surplus of $40.97 billion, again surpassing by a huge margin the forecasts of the economic departments which had predicted a full year IT surplus of about $34 billion. In fact, this prediction itself was raised from the earlier one that estimated a $20 billion annual IT surplus.
Along with the estimated increase in the exports of semiconductors and other IT products, the Central Bank of South Korea has also attributed the increase in export numbers to the recent exports of automo­biles and steel exports. The value of the won had subsequently increased against the U.S. dollar by a significant amount of 10 percent, thus enabling the South Ko­rean government to actually rein in its cur­rency. The industrial production of South Korea has also witnessed small progressive gains every month. It continues to witness small growths, showing a 2.3 percent rise in November from that of October. To the joy of the South Korean IT industries, the increased figure that came out in the month of November was much higher than the es­timation of the esteemed economists of the Dow Jones News, who had predicted a me­dian forecast of a 0.8 percent rise.
In November of last year, the rise has been a decent amount of 2.9 percent, a sharp turn in the scheme of things in the indus­trial zone and a rebound from the drastic fall in October of about 0.8 percent. Again outwitting the predictions of the econo­mists of the Dow Jones News, the figure in November stood much better than the 0.8 percent growth that they had suggested for the IT industry. Still, the Korean economy, which depends on exports to other coun­tries, has been partially affected due to a deficiency of export destinations which are shrinking, due in part to the sovereign debt crisis covering a major area of Eurasia. The Chinese slow-down process also affected ex­ports. Thus to analyze the probable decline in the information technology industry and to devise a recovery, the Ministry of Finance in South Korea has revised down South Ko­rea’s IT industry growth forecast for this year from the earlier forecast of 3.3 percent to a mere 2.1 percent. The finance ministry has also slashed down the probability esti­mate for 2013 from 4 percent growth to 3 percent

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