June 11, 2020 / 4:12 AM / a month ago

South Korea June 1-10 exports soar 20.2%, raising global recovery hopes

FILE PHOTO: A truck drives between shipping containers at a container terminal at Incheon port in Incheon, South Korea, May 26, 2016. REUTERS/Kim Hong-Ji/File Photo

SEOUL (Reuters) - South Korea’s exports for the first 10 days of June soared 20.2% from the same period a year earlier, raising hopes for a firm recovery in shipments for the trade-reliant economy as many countries lift stringent coronavirus lockdown measures.

The trade data, the first to be reported among major economies, might also signal a bottoming out in the virus-fuelled collapse of global demand.

The average exports per working day fell 9.8% on-year, the Korea Customs Service data showed on Thursday. Imports jumped 8.5%, after dropping 36.5% for the same period in May.

“Its a positive sign for global demand. Although per-day exports declined, the fall is smaller and shows easing of global lockdowns is leading to higher demand,” said Moon Jung-hui, a Seoul-based economist at KB Bank.

“Note soaring chip sales. Chips are very sensitive to global recovery cycle so strong demand for it reflects global demand is improving,” Moon said, adding Korean chips could also benefit from the renewed Sino-U.S. tension as demand for made-in-China products could weaken.

Before June, exports tumbled for the third straight month through May, as extended global lockdown measures to contain the coronavirus pandemic weighed on worldwide demand.

Thursday’s data showed overseas sales of semiconductors, the nation’s top selling item, jumped 22.6% in the first 10 days of June, while exports of mobile devices surged 35.8% on-year.

Exports of medical items were up 136.7% on-year, as the country has been fast to export test kits, face masks and other medical supplies after early success in containing the virus.

Destination wise, exports to China were up 35.7% for the first 10 days, while that for the United States and Europe also surged 15.1% and 22.2%, respectively.

Reporting by Cynthia Kim; Editing by Kim Coghill & Shri Navaratnam

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