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SEOUL (Reuters) – South Korea’s exports grew at their fastest pace in 26 months in December, on strong demand for chips and improving global demand, providing additional signals that the recovery is on the right track despite the resurgence of the new coronavirus.
Exports in the last month of 2020 grew 12.6% year-over-year, the strongest growth since October 2018 when they rose 22.5%, government data showed on Friday.
The growth rate was significantly higher than expected as analysts expected a 5.6% jump from a year earlier and was much faster than a 4.1% growth in November.
“Semiconductor exports have been exceptionally strong, with 11 of the top 15 exporting products showing growth … sales of computer products have spurred overall growth,” a Commerce Ministry official told Reuters.
South Korea’s monthly trade data, the first to be released among the major exporting economies, is considered an indicator of world trade.
Foreign semiconductor sales jumped 30% from the previous year, marking the strongest expansion since August 2018, leading to an overall recovery in exports.
Other major items such as mobile devices, screens and computers also soared 39.8%, 28.0% and 14.7% year over year.
By destination, exports to China, South Korea’s largest trading partner, increased 3.3% from last year, and those to the United States and the European Union jumped by 11.6% and 26.4%.
Imports rose 1.8%, reversing a 1.9% drop in November and marking the best reading since April 2019. The Reuters poll forecast a decline of 2.6%.
Meanwhile, for the whole of 2020, South Korea’s exports slipped 5.4% as the coronavirus pandemic swept global trade, but it was much better than a drop of 10, 4% in 2019, the worst in a decade and the third worst in the country’s modern history. .
South Korean financial markets are closed on Friday for the New Year’s holidays and will resume trading on Monday.
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