KITA forecasts record exports for South Korea this year

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SEOUL, December 05 (AJP) - South Korea's exports are on track to top $700 billion for the first time in history, with the recovery expected to continue into 2026, according to a report released on Dec. 5 by the Korea International Trade Association (KITA).

KITA's Institute for International Trade said exports are projected to rise 3.0 percent this year to $704 billion, while imports are expected to slip 0.3 percent to $630 billion. That would leave the country with a trade surplus of $74 billion.

Semiconductors and shipbuilding are the main drivers behind the record performance. Chip exports have climbed sharply on growing demand for AI-related components such as high-bandwidth memory, paired with limited global production capacity that has pushed up prices. Shipments of vessels are also set to increase more than 22 percent as high-value LNG carriers ordered in 2022 and 2023 are delivered.

Automobile exports, which were hit earlier in the year by increased U.S. tariffs, are expected to grow 1.6 percent as South Korea shifts more shipments to Europe and other non-U.S. markets. KITA said exports to the United States rebounded in November with a 13.7 percent increase, helped by expectations of tariff reductions following recent bilateral negotiations. Steel and petroleum products, however, are expected to remain weak through the end of the year due to higher duties and falling crude prices.

For 2026, KITA projects that exports will continue on a positive track, increasing 1.0 percent to $711 billion. Imports are forecast to edge up 0.5 percent to $633 billion, keeping the trade balance in surplus.

Information-technology products are expected to lead next year's growth. Semiconductor exports are forecast to rise 5.9 percent as AI-related demand remains strong. SSD exports are expected to increase 10.4 percent on the back of expanding enterprise-level storage needs. Wireless communication devices are projected to grow 5.4 percent as foldable smartphones gain ground and memory-chip prices rise. Display exports are likely to post a small gain as OLED panels continue to expand in IT devices and premium smartphones.

Other sectors face a more challenging outlook. Automobile exports may fall 1.0 percent due to base effects and gradual expansion of U.S. local production. Petroleum products are projected to decline 13.3 percent as crude prices settle in the mid-50-dollar range. Petrochemical exports are expected to drop 6.1 percent amid continued global oversupply, while steel exports may fall 2.0 percent under ongoing U.S. tariffs and subdued demand.

KITA said next year's import trends will largely reflect weaker energy prices, though higher imports of semiconductor components and manufacturing equipment could offset some of the reduction.

Park Sae-jin swatchsjp@ajunews.com