Semiconductor transactions increase, Japan surpasses China to become South Korea's second largest trade deficit country
According to BusinessKorea, after South Korea's trade deficit with China narrowed, Japan surpassed China for two consecutive months and ranked second in South Korea's trade deficit ranking.
According to the report "Import and Export Trends in July 2023" released by the South Korean Ministry of Industry, Commerce, and Resources on August 13th, the trade deficit with Japan has been ranked second for two consecutive months (June and July this year), second only to the deficit in importing crude oil from the Middle East.
In June of this year, the trade gap between South Korea and Japan was -1.78 billion US dollars, while the trade gap with China was -1.3 billion US dollars. In July, the trade balance with Japan was -153 billion US dollars, while the trade balance with China was -127 billion US dollars. According to data from the Ministry of Industry, Commerce, and Resources, it has been four months since February this year that Japan has ranked second on the trade deficit ranking.
According to the Korea Trade Association, Japan was the country's largest trade deficit from 1983 to 2010 and from 2015 to 2021. However, since January this year, the deficit between South Korea and China has sharply increased, pushing Japan's ranking to a lower position.
As South Korea's deficit with China gradually decreases, coupled with an increase in imports of semiconductors from Japan, Japan has surpassed China in its deficit ranking over the past two months. South Korea's deficit with China has decreased from $-3.93 billion in January to $-127 billion in the previous month, reducing to less than one-third of the original level.
In contrast, semiconductor imports from Japan increased significantly, reaching $520.3 million in June, up from $260 million in May. The import volume of semiconductors in July reached $360.7 million. In addition, the import value of Japanese semiconductor testing equipment also surged from $42 million in May to $93 million in June, reaching a high of $96 million in July. The depreciation of the Japanese yen is believed to have partially affected the increase in imports of Japanese steel products.
If the semiconductor market recovers in the second half of 2023, South Korea's trade deficit with Japan may further expand. However, due to the expected increase in imports of secondary battery materials, the core components of electric vehicles, from China, the trade deficit ranking in the second half of the year is expected to remain unstable.
According to the report "Import and Export Trends in July 2023" released by the South Korean Ministry of Industry, Commerce, and Resources on August 13th, the trade deficit with Japan has been ranked second for two consecutive months (June and July this year), second only to the deficit in importing crude oil from the Middle East.
In June of this year, the trade gap between South Korea and Japan was -1.78 billion US dollars, while the trade gap with China was -1.3 billion US dollars. In July, the trade balance with Japan was -153 billion US dollars, while the trade balance with China was -127 billion US dollars. According to data from the Ministry of Industry, Commerce, and Resources, it has been four months since February this year that Japan has ranked second on the trade deficit ranking.
According to the Korea Trade Association, Japan was the country's largest trade deficit from 1983 to 2010 and from 2015 to 2021. However, since January this year, the deficit between South Korea and China has sharply increased, pushing Japan's ranking to a lower position.
As South Korea's deficit with China gradually decreases, coupled with an increase in imports of semiconductors from Japan, Japan has surpassed China in its deficit ranking over the past two months. South Korea's deficit with China has decreased from $-3.93 billion in January to $-127 billion in the previous month, reducing to less than one-third of the original level.
In contrast, semiconductor imports from Japan increased significantly, reaching $520.3 million in June, up from $260 million in May. The import volume of semiconductors in July reached $360.7 million. In addition, the import value of Japanese semiconductor testing equipment also surged from $42 million in May to $93 million in June, reaching a high of $96 million in July. The depreciation of the Japanese yen is believed to have partially affected the increase in imports of Japanese steel products.
If the semiconductor market recovers in the second half of 2023, South Korea's trade deficit with Japan may further expand. However, due to the expected increase in imports of secondary battery materials, the core components of electric vehicles, from China, the trade deficit ranking in the second half of the year is expected to remain unstable.