U.S.-bound shipments to remain bullish; challenges lie ahead: BOK report

Exports to the United States are likely to continue to rise, backed by massive investments by South Korean chipmakers and battery makers in the world's largest economy, but sticky issues such as trade restrictions lie ahead, a report from the Bank of Korea said Thursday. According to the report, U.S.-bound shipments have continued to take up a bigger slice of South Korea's overall exports since 2020, with the portion surpassing shipments to China for the first time in 21 years in the second quarter of last year. Aided by robust private spending and investment in the U.S. economy, South Korea's exports are expected to remain bullish and shipments to China and Southeast Asian countries are also forecast to rise. Also, South Korean manufacturers, such as chipmakers and battery makers, are ramping up investments, which leads to a surge in imports from Asia's fourth-largest economy, the central bank said. But over the mid-haul, increased competition, higher production costs and potential trade restrictions may pose challenges to such a rosy outlook. The central bank said the U.S. had taken trade restrictions against certain countries over widening trade deficit with them as were seen in 2017 under the Trump administration, such as the renegotiation of free trade agreements and the implementation of safeguards. Source: Yonhap News Agency