Historic First: Korea's Exports to Surpass Japan's in 2023?

A historic change is coming! It's not just about GDP growth rate, but South Korea's exports are also about to surpass Japan's! What exactly has happened?News on October 14th, the latest data shows tha...

A historic change is coming! It's not just about GDP growth rate, but South Korea's exports are also about to surpass Japan's! What exactly has happened?

News on October 14th, the latest data shows that this year, South Korea's exports have been climbing continuously. With less than three months left until the end of the year, several statistics and surveys indicate that for the first time in history, South Korea's total export value for the year 2024 is expected to exceed that of Japan.

Additionally, according to the latest forecast by the International Monetary Fund (IMF), South Korea's actual GDP may grow by 2.5% this year, while Japan's growth is only expected to be 0.7%.

So, how much are South Korea's exports this year?

According to the latest foreign trade data released by the Ministry of Trade, Industry and Energy of South Korea, the cumulative export value for the first nine months of this year reached $508.8 billion, the second highest for the same period in history. The export value in the third quarter increased by 10.7% year-on-year to $173.9 billion, the second highest for the same quarter in history.

Among them, exports in September alone surged by 7.5% to $58.77 billion, setting a new monthly record and marking 12 consecutive months of growth, with an average export value of $2.94 billion per working day.

Undoubtedly, all these data are sufficient to attract market attention to whether South Korea's export value can surpass Japan's. It is important to note that this year, the gap between the export values of South Korea and Japan is only $3.5 billion, a new low.

Looking at the specific data, in the first half of this year, South Korea's exports increased by 9% year-on-year to $334.8 billion, while Japan's exports decreased by 3.6% year-on-year to $338.3 billion.In other words, the export trends of South Korea and Japan have undergone a drastic shift.

In response, Kang In-won, a professor of international business and trade at Kyung Hee University in South Korea, stated that whether South Korea's exports can surpass Japan this year depends entirely on whether the momentum of South Korea's export growth continues into the fourth quarter.

Kang In-won said, "Japan's exports are on the rise, especially as the export gap between South Korea and Japan widened again in July and August. This means that South Korea must accelerate the growth rate of its exports in the fourth quarter in order to catch up with and ultimately surpass Japan."

Furthermore, data also shows that from January to August of this year, Japan's cumulative exports amounted to $472.3 billion, while South Korea's were $450.1 billion.

In this regard, the official responsible for South Korea's trade affairs stated that the South Korean government's goal is to exceed $700 billion in annual exports in the coming years to surpass Japan, as Japan's annual exports have exceeded this level over the past three years.

The official pointed out that although the goal for this year is to reach the $700 billion milestone, in terms of the growth rate of exports, it is still "a bit short of the target."

Finally, Kang In-won stated that even if South Korea's export volume does not surpass Japan this year, the continuous growth in export data indicates that the South Korean government's ability to drive the economy is stronger than that of the Japanese government.