According to the commerce ministry on Monday, South Korea exported $11.3 billion worth of products to the US in December, compared to $10.9 billion to China. The change in roles occurred as South Korea’s total exports increased 5.1% from the previous year – the third month of growth following a year-long decline.
The shift in opinions is partially explained by China’s economic difficulties, which prompted decision-makers to implement many stimulus plans last year. Even so, a month’s worth of data cannot provide solid evidence of a deliberate or long-lasting change in trading behaviour.
Considering the volume of goods Seoul purchases from the second-largest economy in the world, China continues to be by far South Korea’s greatest trade partner.
For the sixth month in a row, exports to the US have surpassed those to the previous year, but South Korea said that sales to China have also been getting better. In the meanwhile, South Korea’s total imports fell by 10.8% from the previous year, and the country’s trade surplus increased to $4.5 billion.
The information is released as the US seeks backing for its plan to restrict China’s access to cutting-edge semiconductor technology and lessen its reliance on it in international supply chains.
As a result, nations like Japan and South Korea find themselves sandwiched between their two largest economic partners. Tokyo and Seoul are two of Washington’s most significant military partners, which is crucial considering Beijing’s growing aggressiveness in the Indo-Pacific and the escalating tensions in the area.
South Korea has been strengthening its relations with the United States under President Yoon Suk Yeol. Yoon took a group of Korean business executives to Washington last year, when he met with Congress and President Joe Biden to advocate for closer relations with the United States.
Since the US and South Korea signed a free trade agreement in 2012, Seoul has benefited from US regulations that tighten restrictions on the use of batteries and other items produced in nations like China.
As it advances up the value chain, China is also increasing its domestic manufacturing of commodities. Manufacturing of semiconductors and smartphones is one of China’s main areas of concentration; this trend has led to a decline in sales of products manufactured by companies like Samsung Electronics Co. and others.