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South Korea's Exports Up 20.2 Percent In February; Fastest Rise In 5 Years

By February 28, 2017 at 11:24 pm
Korea's Economy (Photo : Chung Sung Jun/Getty Images)

South Korea's exports rose over 20 percent in February from the same month a year earlier and accelerated at its fastest pace in five years due to increasing oil prices and rebounding world trade, according to a government report released Wednesday.

Outbound shipments jumped 20.2 percent on-year to US$43.19 billion in February, compared to an 11.2 percent gain in January, according to preliminary data from the Ministry of Trade, Industry, and Energy. 

February's gain resulted to a trade surplus of $7.22 billion. The latest reading surpassed the median forecast of seven analysts surveyed by The Wall Street Journal for a 16.5 percent gain.

The result marked the first time since February 2011 that South Korea's exports have recorded a double-digit increase for two consecutive months.

The country's shipments have contracted over the past two years due to slow global demand, with exports shrinking 5.9 percent in 2016.

South Korea's exports to its biggest customer, China, climbed for the fourth consecutive month while semiconductor exports tallied their best-ever monthly performance, helped by months-long expansion in electronics, the trade ministry said.

Shipments to China are still growing, but analysts are watching closely if the deployment of the Terminal High Altitude Area Defense system (THADD) in South Korea will have an impact moving forward, referring to tension between the neighboring countries over Seoul's decision to allow the US missile defense missile system in the country.

Meanwhile, imports increased 23.3 percent from a year ago to $35.97 billion in February after a revised 19.7 percent gain in the previous month. Last month's reading on imports is in line with the median forecast for a 24.9 percent gain in February.

Earlier this week, the South Korean government plans to diversify products and markets for exports to lessen its reliance on its two largest customers, China and the US. 

South Korean officials are also wary of the risks to exports of new US President Donald Trump's more protectionist stance on trade. 

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