"Rus-Ukrainian Ceasefire and Improved Conditions Could Enable $28.5 Billion Trade Surplus Next Year"

MuHyup Holds '4th Trade Industry Forum - 2023 Trade Outlook and Our Response'

At the 4th Trade Industry Forum held by the Korea International Trade Association on the 8th at the Trade Tower in Samseong-dong, Hong Ji-sang, a research fellow at the KITA International Trade and Commerce Research Institute, is giving a presentation on "2023 Trade Outlook and Response Tasks."

[Asia Economy Reporter Park Sun-mi] It is forecasted that if the Russia-Ukraine conflict and COVID-19 end next year, the global economy will grow by 4%, and South Korea's trade balance will record a surplus of 28.5 billion dollars.

On the 8th, Hong Ji-sang, a research fellow at the Korea International Trade Association's International Trade and Commerce Research Institute, stated at the '4th Trade Industry Forum' held by KITA at Trade Tower in Gangnam-gu, Seoul, that assuming ▲a reduction in COVID-19 uncertainties, ▲a low-intensity Russia-Ukraine war continuing, and ▲the West's continued containment of China, with global economic growth in the mid-2% range and global trade growth around 1%, exports and imports next year are expected to decrease by 4% and 8%, respectively.

However, under an optimistic scenario where ▲COVID-19 ends, ▲the Russia-Ukraine war concludes, and ▲protectionism eases, leading to both the global economy and global trade growing in the 4% range, exports are expected to maintain a flat trend similar to this year, imports to decrease by 10%, and the trade balance to turn into a surplus of 28.5 billion dollars.

By industry, in semiconductors, the global market for the main product, memory, is expected to shrink double digits (-17%), and export prices will also fall double digits, resulting in a 15.0% decrease in exports next year. Steel products are projected to see only a 1% increase in global demand in 2023, with oversupply and price declines causing exports to decrease by 9.9%.

In his opening remarks, Chung Man-ki, Vice Chairman of KITA, said, "Despite difficult conditions, we are expected to set records by achieving an all-time high export of 690 billion dollars, ranking as the world's 6th largest exporting country, and for the first time ever, becoming the world's 6th largest trading nation.” He added, “Although the rise in energy prices and the trade deficit caused by an energy overconsumption structure are regrettable, if the government, companies, workers, and management cooperate, these challenges can be overcome without much difficulty.”

He further stated, “While forecasts suggest that both exports and imports will decline next year, trade will be influenced by highly uncertain variables such as COVID-19 and the Russia-Ukraine war,” and added, “If we respond thoroughly to both pessimistic and optimistic scenarios, we can achieve good results.”