93.7%, this is the year-on-year growth rate of South Korea's exports in October this year. Data released by the Ministry of Industry, Trade and Resources of South Korea on November 1 shows that South Korea's exports reached $115.28 billion in October, staying above the $110 billion mark for two consecutive months.
Breaking down the structure, the answer is almost brutally concentrated in one category. In October, semiconductor exports reached $56.44 billion, accounting for nearly half of total exports. This represented a sharp increase of 259.4% compared to the same period last year. Computer exports also saw a rise of 496.6%. There was growth in petroleum products, automobiles, and cosmetics as well. However, what truly pushed South Korea’s exports from “growth” to “explosive growth” was, unsurprisingly, chips.
More precisely, due to the competition in AI computing power, global technology giants continue to increase their investment in AI infrastructure. This has led to a simultaneous rise in the demand for high-performance memory chips, as well as their prices and shipments. The demand for SSDs for servers has also increased significantly, benefiting Korean chip companies such as Samsung Electronics and SK Hynix.
This chip industry boom is not unfamiliar to the Chinese market. In October, South Korea's exports to China amounted to $26.98 billion, a growth of 133.6%; exports to the United States reached $24.9 billion, a growth of 185.8%. The two major markets of China and the United States have been actively developing almost simultaneously.
The figures for exports were impressive, but the atmosphere in South Korea was far from peaceful and harmonious.
According to data released by the South Korean Financial Supervisory Service recently, in September foreign investors sold a total of 19.116 trillion won worth of shares listed on the KOSPI and KOSDAQ in South Korea. Among these sales, European funds sold 10.3 trillion won, American funds sold 4.9 trillion won, and Asian funds sold 1.7 trillion won.
Yonhap pointed out that this reflects market concerns about the profitability of artificial intelligence. Earlier in August, South Korean stocks just ended a period of net sales for seven consecutive months.
Former Governor of the Bank of Korea, Lee Chang-yong, previously warned that the current high prosperity of South Korea's semiconductor industry reflects both the competitiveness of Samsung Electronics and SK Hynix, as well as the difficulty faced by China in obtaining some advanced lithography equipment due to the tense Sino-US relations. Whether South Korean chip companies can maintain their high profitability if Sino-US relations improve or if China develops its own lithography equipment needs to be re-evaluated.
At the same time, the South Korean government also acknowledges that despite the strengthened economic growth, pressures on people's livelihoods in areas such as prices continue to exist, and structural issues such as polarization across different sectors remain. The South Korean Ministry of Finance and Economic Affairs has promised to increase efforts to stabilize people's livelihoods and reduce polarization, so that the benefits of economic growth can be shared by all citizens.
South Korea's exports are close to achieving its target of $1 trillion for the year. As of the end of October, South Korea's cumulative exports this year have reached $930 billion, just 7 billion dollars away from the target.
This is the result of decades of industrial accumulation and global market competition. It also means that the growth of the Korean economy is becoming increasingly vulnerable to global AI investment cycles, storage chip prices, and international technological competition.
The more prominent the export figures, the more pressing becomes the issue of reducing dependence on a single industry cycle for the South Korean economy.
