KITA News and Reports
  • Exporters Anticipate This Year’s Export Growth Rate Around 5 %
    2018-05-10

    Exporters Anticipate This Year’s Export Growth Rate Around 5 %

    - KITA’s ‘Business Outlook in Overseas Markets’ presented mixed prospects

    for different markets and industries -

     

    While Korean exporting companies expect that this year’s export growth rate would be around 5 percent, an analysis forecasts that in China and the Unites States, the world’s largest markets, the results will be different by industry.

     

    According to the report titled '2018 Exporters’ Overseas Business Outlook,' issued by the Institute for International Trade (President, Shin Seung-kwan) of the Korea International Trade Association, 28.7 percent of respondents said that ‘this year’s exports will increase by 0 ~ 3%’ followed by '3-5% will increase' (24.2%) and '5 ~ 10% increase' (19.9%). Exporters expected to expand their exports to the United States and China in particular and expressed their concerns at the same time over both markets regarding the US and China trade disputes and import regulations.

     

    By item, exports are expected to increase thanks to rising demand for petroleum products in China. However, the wireless communication devices are expected to suffer from intensified global competition. While the exports of cars and automotive components to the United States are expected to improve, the exports of steel and nonferrous metals are expected to be sluggish due to increasing pressure on trade.

     

    As the main reasons for being optimistic for this year’s exports, the respondents chose 'securing new buyers' (37.6%) and 'economic recovery of export destinations' (22.6%). On the contrary, the biggest factors for the negative views that the exports would be sluggish were 'intensified trade protectionism' (39.0%) and 'losing product competitiveness' (21.1%).

     

    The exporting companies responded that 'price reduction' (28.4%), 'quality innovation' (27.6%) and 'technology development' (21.6%) are important in order to differentiate themselves from their competitors. As the major difficulties, they picked ‘lack of new products’ (18.4%), ‘lack of information about local markets’ (17.8%), and ‘lack of funds’ (16.7%). 

     

    Meanwhile, 49 percent of the surveyed companies responded that they ‘had plans to hire this year’, which was similar to those said 'No' (51%). By company size, it appears that the larger companies have more plans to recruit employees as 66.2 percent of ‘big conglomerates’, 50.8 percent of mid-sized companies, and 46.9 percent of small and medium-sized enterprises said that they had plans for employment.

     

    Lee Jin-hyung, a researcher at the Institute for International Trade said, As the global economy is recovering recently, expectations for exports expansion and the concerns over the conflict between G2 to take the lead, trade pressure, and decrease in export competitiveness are rising together. He stressed, It is important for the companies to secure product competitiveness and to constantly monitor opportunities created by changes in the global economy.

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