Korea’s dependence on manufactured imports surpasses 30% for the first time in the third quarter


[Graphics by Song Ji-yoon]

Three of the 10 factory products sold in South Korea are imports, underscoring the country’s weakness in the face of trade barriers from major commodity exporters like China.

The country’s manufacturing domestic supply index in the third quarter ended September rose 2% from a year earlier to 105.3, according to Statistics Korea. The gain was driven by a 13.9% year-over-year jump in manufactured imports, while supply from local manufacturers fell 2.4%.

The share of imports in Korea’s total supply of manufactures reached 30.2 percent in the third quarter, up 2.7 percentage points from the same period last year. The share exceeded 30 percent for the first time since data became available in the first quarter of 2010. It has increased steadily from 26.7% in the fourth quarter of 2020, 28.5% in the first quarter of 2021 and 28 , 7% in the second trimester.

Imports accounted for 43.5% of the total supply of drugs and medical supplies in the country, up 10.2 percentage points from last year. The share of imports of manufactured goods in the petroleum refining sector increased by 7.2 percentage points to 36.7% and other goods increased by 5.9 percentage points to 42.6%.

The share of imports in the supply of finished products increased by 3 percentage points to 32.9%, that of intermediate goods by 2.7 percentage points to 28.5%.

The increase in imports of manufactured goods is attributable to an increased dependence on Chinese imports, especially for intermediate goods such as chemical and steel materials. Imports for the domestic supply of primary metals increased at a much faster rate of 40.9% compared to last year in the third quarter, while the local supply increased by 4.1%. Imports of chemicals also increased by 10.3 percent while domestic supply increased by 2.2 percent.

Domestic automobile supply declined 5.2 percent, due to a 7.3 percent drop in local supply and an 8.8 percent increase in imports. The index of other transport equipment fell by 31.9%, as domestic supply and imports fell by 35.4% and 20.4% respectively. The reading of drugs and medical products rose 17.2 percent on a 2.5 percent increase in domestic supply and 51.5 percent in imports.

By Lee Jong-hyuk and Choi Mira

[â“’ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]

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