South Korea’s Share of China’s Imports Drops to Lowest in 30 Years

SEOUL - South Korea's share of China's total imports fell below 7 percent last year, marking the lowest percentage in three decades, amidst shifts in bilateral trade dynamics and a downturn in the global information technology sector. This development reflects changing patterns in the economic relationship between the two countries and evolving market demands.

According to Yonhap News Agency, South Korea constituted 6.3 percent of China's overall imports in the past year, a decline from 7.4 percent in 2022. This figure represents the smallest proportion since 1993, the year following the establishment of diplomatic ties between Seoul and Beijing, when the figure stood at 5.2 percent.

The decrease in South Korea's export share is notably attributed to a significant 30.6 percent reduction in semiconductor shipments to China, which totaled US$36.1 billion last year amid weak global demand. Semiconductors are a critical export for South Korea, highlighting the impact of the global IT industry's slump on the nation's trade performance.

South Korea ranked as the third-largest exporter to China in the last year, following Taiwan and the United States, experiencing a decline in its position from the previous year. The country held the top spot as China's biggest exporter from 2013 to 2019. However, recent years have seen a weakening of South Korea's standing in China's import market. This shift is partly due to Beijing's efforts to bolster its own industries in smartphones, displays, automobiles, and others, which directly compete with key South Korean sectors.

Cho Sang-hyun, a senior official at KITA, commented on the evolving trade relationship, noting that the economic cooperation model has transformed since 2010. Initially, the partnership involved South Korea supplying intermediary goods for Chinese finished product manufacturing. However, the increasing self-sufficiency of Chinese manufacturing industries has necessitated a strategic pivot for South Korean exports.

Cho emphasized the need for South Korea's export industry to diversify its offerings beyond semiconductors to maintain and enhance its competitive edge in the Chinese market. This adjustment is crucial for sustaining the economic relationship and navigating the challenges of an increasingly self-reliant Chinese manufacturing sector.

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