SEOUL: Korea’s exports to Australia rose 7.5 percent in the January-November period, in sharp contrast to the country’s overall exports which fell 7.4 percent in the same period due to sluggish global demand, the Korea Customs Service (KCS) said Tuesday.
“Australia is a relatively small trading partner (for Korea) but we expect exports to the country under the free trade agreement signed on Dec. 12 last year will increasingly contribute to the country’s weakening exports in coming years,” a KCS official said.
Helped by sharply increased exports of offshore facilities to resource-rich countries, Korea’s shipments to Australia jumped to $10.08 billion in the first 11 months from $9.38 billion a year earlier, the customs office reported.
Offshore facilities refers to gas and oil-exploring ships such as floating production, storage and offloading units (FPSOs) and drilling rigs. It costs much more to build an offshore facility due to high-end technologies compared with commercial ships such as container carriers and bulk ships.
From January to November, Australia placed orders for $1.26 billion of offshore facilities with Korean shipbuilders such as Hyundai Heavy Industries, Samsung Heavy Industries and Daewoo Shipbuilding & Marine Engineering. A year earlier, the corresponding figure was $190 million, the KCS said.
Restricting further rises in exports, vehicle shipments to Australia fell 3.5 percent in the 11-month period to $1.65 billion from a year earlier, though tariffs on cars delivered to the country were fully lifted in the first year of the free trade pact, it said.
“Korean carmakers had a tough battle this year in Australia and other major markets as they had to compete with their Japanese rivals such as Toyota, which benefited from the weakening yen,” an official said.
The Korean won remained relatively strong against the dollar compared with other currencies, weighing on Korean exporters. A weaker yen has a positive impact on financial results when Japanese exporters convert overseas earnings into the Japanese currency.
In total exports during the first 11 months, Asia’s fourth-largest economy posted $484.53 billion, down from $523.40 billion a year earlier due mainly to slowing demand from China, the world’s second-largest economy after the United States, the KCS said.
When it comes to imports from Australia, Korea brought $1.09 billion worth of beef and other meat products in the 11 months, up 18 percent from a year earlier, it said.
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