SEJONG: South Korea’s exports are forecast to make a turnaround in the fourth quarter of this year for the first time in two years thanks to rising oil prices, the trade minister said Monday. Exports, the key growth driver of Asia’s fourth-largest economy, have been in a deep slump for nearly two years due mainly to a global slowdown and low oil prices, which dampened demand from oil-rich countries. For the first 11 months of 2016, the country’s exports fell 7 percent from the same period last year, following an 8 percent on-year drop in 2015. The monthly figure has posted minus growth 21 times in the past 23 months since January 2015.
In recent months, however, data showed some signs of recovery amid an uptick in crude oil prices. The country saw outbound shipments rise 2.5 percent in November, turning around from a 3.2 percent on-year fall in October and 5.9 percent drop in September. “I think the upbeat trend of exports will continue in December,” Trade Minister Joo Hyung-hwan said in a meeting with reporters. “As a result, exports will rebound in the final quarter, and it will be the first time that the quarterly exports finish in positive territory since the fourth quarter of 2014.” The trade minister also expected exports to expand around 2 percent next year on the back of a recovery in global trade and higher oil prices.
“A modest upturn in world trade and rising oil prices will lend support to South Korea’s exports,” said Joo. “But uncertainties remain out there, such as strengthening trade protectionism, the upcoming U.S. government and the British exit from the European Union.” Local think tanks also forecast that South Korea’s exports will rebound to gain some 2 to 3 percent next year, with the country’s economy expected to grow around 2.5 percent in 2017.
