SME Exports Rise 4.9% Year-on-Year in 2023, Reaching $115.1 Billion

Number of Exporting SMEs Reaches 95,905
Up 1.5% from Previous Year

Last year, the export value of small and medium-sized enterprises (SMEs) reached $115.1 billion, marking a 4.9% increase compared to the previous year. This represents the second-highest export value for SMEs on record (provisional figures).

On January 23, the Ministry of SMEs and Startups announced the '2024 SME Export Trends (Provisional)'. SME exports maintained a steady upward trend throughout last year. From the fourth quarter of 2023 to the fourth quarter of last year, exports increased for five consecutive quarters, and for the first time in three years since 2021, annual SME exports returned to a growth trajectory.

The number of exporting SMEs stood at 95,905, a 1.5% increase from the previous year, while the number of new exporting companies reached 25,000, up 0.7% year-on-year. In addition, the number of continuous exporters was 70,905, a 1.8% increase from the previous year, indicating an overall improvement in key indicators related to SME exports.

The top export item among SMEs was cosmetics ($6.8 billion, +27.7%), followed by automobiles, plastic products, and automobile parts. The concentration ratio of the top 10 export items among all SME exports was 34.1%, which is relatively low compared to the top 10 items' share of total national exports (59.1%).

Among the top 10 export items by value, 8 saw an increase in exports compared to the previous year. Notably, cosmetics and semiconductor manufacturing equipment recorded double-digit growth rates. Analyzing the factors behind the increase in major export items, cosmetics achieved an all-time annual high, as exports to the United States, Japan, Vietnam, and other countries increased, offsetting declines in exports to China. This marks the first time a single SME export item has surpassed $6 billion. For semiconductor manufacturing equipment, the global semiconductor market's recovery and increased demand driven by China's policies to foster its domestic semiconductor industry-China being the largest export destination for this item-led to double-digit growth rates in major trading partners such as China, Taiwan, the United States, and the Netherlands, resulting in a record annual export value. In the case of automobiles, rising recognition of product quality in countries neighboring Russia, such as Kyrgyzstan and Kazakhstan, led to six consecutive months of strong export performance. On an annual basis, automobile exports increased for the fourth consecutive year, reaching an all-time high.

The top export destinations for SME exports were the United States, China, Vietnam, Japan, and Hong Kong, in that order. Among the top 10 countries, 7 saw an increase in export value. In the case of the United States, all of the top 10 export items to the US increased, resulting in the largest export value growth among all export destinations in 2024. Hong Kong recorded the highest export growth rate among the top 10 SME export destinations, with fashion accessories and precious metals (gold, silver, platinum) showing triple-digit export growth rates. In Taiwan, increased investment from multinational companies as a global semiconductor production hub led to expanded demand for semiconductor manufacturing equipment, boosting exports. In contrast, Russia experienced the largest decline among the top 10 countries, as most items saw a decrease in exports due to expanded export controls on items shipped to Russia.

SME online exports reached $1.01 billion, a 32.3% increase year-on-year, surpassing the $1 billion mark for the first time. The share of SME exports in total domestic online exports was 73.2%, indicating that SMEs are leading the online export sector. Major online export items such as cosmetics and computers saw significant growth, particularly in exports to the United States.

Meanwhile, in the fourth quarter of 2024, SME exports amounted to $29.76 billion, a 5.9% increase compared to the same period last year, while the number of exporting SMEs reached 66,438, a 2.0% increase year-on-year.

Choi Wonyoung, Director General for Global Growth Policy at the Ministry of SMEs and Startups, stated, "Despite difficult external conditions such as high interest rates and inflation, SME exports have performed well. However, uncertainties for SMEs are mounting, including the launch of a second Trump administration and the continued high exchange rate environment." "The Ministry of SMEs and Startups will closely monitor these external changes and make every effort to promptly address the challenges faced by SMEs," he added.