Rising Challenges for South Korean Semiconductor Exports from China and Malaysia
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Seoul, Dec 16 (NationPress) South Korea's semiconductor exports are facing escalating challenges from China, Taiwan, and Malaysia as global competition in advanced sectors intensifies, as revealed by an industry report released on Monday.
The report from the Korea Trade-Investment Promotion Agency, commonly referred to as KOTRA, evaluated the export similarity index (ESI) for semiconductors, indicating that China stands as South Korea's primary competitor in this field, boasting an ESI score of 72.2 for the third quarter of this year.
Moreover, Taiwan's ESI with South Korea in the semiconductor arena saw a substantial rise, climbing 7.6 points over four years to reach 32.5, representing the largest increase among significant semiconductor exporters, as reported by Yonhap news agency.
Additionally, Malaysia experienced a 6-point rise in its ESI to 50.5 during the same timeframe, marking the second-highest growth following Taiwan.
KOTRA pointed out that Malaysia is emerging as a formidable rival, currently ranked fifth globally in semiconductor exports while managing 13 percent of the world’s semiconductor assembly, testing, and packaging operations.
The report expressed concerns that South Korea's inability to maintain a technological advantage over its competitors could diminish its export strength in this sector.
"This is a pivotal moment to capitalize on technological capabilities to enhance South Korea's market share in export sectors," KOTRA emphasized in the report, urging that, "South Korean companies must swiftly devise strategies to bolster their export competitiveness."
In a related note, South Korea's exports surged by 12.4 percent in the first ten days of this month compared to the previous year, driven by robust semiconductor shipments, according to data released on Wednesday.
Outbound shipments totaled $17.6 billion during the December 1-10 period, compared to $15.6 billion in the same timeframe last year, as per data from the Korea Customs Service.
Imports rose by 11.6 percent year-on-year to $19.1 billion, leading to a trade deficit of $1.55 billion.
When adjusted for the number of working days, the daily average of exports increased by 5 percent year-on-year to $2.34 billion, as reported by the agency. This year's reporting period included 7.5 working days, in contrast to 7 working days from the same period last year.
"Our exports continue to exhibit positive momentum as both total and daily average exports have risen compared to the same period last year," stated Jo Eek-no, director general for international trade policy at the industry ministry.
Exports of semiconductors skyrocketed by 43 percent year-on-year to $3.61 billion during the mentioned period.
