South Korea's Exports Show 34 Trillion Won Deficit Over Four Months... KITA Urges Ruling Party for "Regulatory Easing to Match Competitors"

Trade Industry Meeting Invited by Kim Ki-hyun, People Power Party Leader
Koo Ja-yeol: "Collaboration to Create Equal Business Environment with Other Countries"
Jung Man-ki: "Need for Measures to Reduce Semiconductor Dependence"

"Our companies are being held back by excessive labor and environmental regulations and a shortage of manpower. Legislative support and deregulation are urgently needed to create a business environment and competitive conditions equal to those of other countries." - Koo Ja-yeol, Chairman of the Korea International Trade Association (KITA)

"The National Assembly must actively engage in legislation to ensure that our companies can operate in a competitive environment on par with rival countries." - Jung Man-ki, Executive Vice Chairman of KITA

The Korea International Trade Association announced on the 3rd that it held a 'Trade Industry Meeting with Kim Ki-hyun, Leader of the People Power Party' at the Trade Tower in Samseong-dong, Gangnam-gu, Seoul, to discuss issues related to export recovery. It appealed to the ruling party that legislative support for deregulation is urgently needed to overcome the crisis in Korean exports, which have incurred a deficit of about 34 trillion won over the past four months.

The meeting was attended by Chairman Koo Ja-yeol, Executive Vice Chairman Jung Man-ki, as well as Chairman Oh Seok-song of MetaBioMed, Chairman Choi Myung-bae of Exicon, President Yoon Chun-sung of LX International (formerly LG Sangsa), and 11 representatives of member companies. From the People Power Party, eight members participated, including Leader Kim Ki-hyun, Policy Committee Chairman Park Dae-chul, and Han Mu-gyeong, Secretary of the Industry, Trade, Energy, Small and Medium Venture Business Committee.

At the 'Trade Industry Meeting Invited by Kim Ki-hyun, Leader of the People Power Party,' Koo Ja-yeol, Chairman of the Korea International Trade Association (center), is delivering a greeting.
[Photo by Korea International Trade Association]

Chairman Koo Ja-yeol expressed gratitude to the political circles for the swift passage of the amendment to the Restriction of Special Taxation Act (K-Chips Act). He said, "The interest and support of the National Assembly are necessary to enhance corporate vitality and strengthen export competitiveness."

Executive Vice Chairman Jung Man-ki stated in his presentation on "Causes and Tasks of Export Slump" that Korea’s export structure, which is excessively dependent on 'China and semiconductors,' must be changed.

Korea’s exports from January to April amounted to $201.2 billion (approximately 269 trillion won), and imports were $226.2 billion (approximately 303 trillion won), resulting in a deficit of $25.1 billion (approximately 34 trillion won). As exports to 'China and semiconductors' declined, Korea’s share of global exports fell from 3.23% in 2017 to 2.74% last year, a drop of 0.49 percentage points. This is the lowest level in 14 years since the global financial crisis period in 2009, when it was 2.89%.

Executive Vice Chairman Jung Man-ki said, "The causes of the export slump are that China has shifted from being the largest trade surplus country to the largest trade deficit country and the semiconductor downturn." He added, "We must implement drastic measures such as increasing production flexibility and significantly easing foreign labor employment." He further stated, "KITA plans to propose export company regulatory reforms at least equal to those of competing countries to the National Assembly," and added, "The National Assembly must actively engage in legislation."

Commemorative photo of the "Trade Industry Meeting with Kim Ki-hyun, People Power Party Leader" hosted by the Korea International Trade Association at Trade Tower, Samseong-dong, Gangnam-gu, Seoul on the 3rd. Koo Ja-yeol, Chairman of the Korea International Trade Association (fourth from the left in the front row), and Kim Ki-hyun, Leader (fifth from the left in the front row), attended.
[Photo by Korea International Trade Association]

Participants at the meeting requested the ruling party for legislative support related to manpower, finance, and tax support. Choi Myung-bae, Chairman of semiconductor equipment company Exicon, said, "Last year, the government announced it would train 150,000 semiconductor personnel by 2031, but the avoidance of engineering universities by talented manpower is worsening," and added, "The target number of personnel must be increased to more than twice the current level."

Yoon Chun-sung, President of LX International, which is engaged in the energy business, said, "Mineral resource development is a large-scale investment project, so it is quite difficult for companies to pursue it alone," and added, "If the government expands financial and tax support for resource development in the future, the financial burden on companies will be reduced."