In South Korea, the coronavirus pandemic continues to strangle exports despite the bureaucracy’s best attempts to fight it off and bring life back to normal.
Quickly, 100 cases had been linked to Coupang, one of the largest e-commerce sites in the world, heading into the weekend. The business did well before the outbreak when people preferred to shop online. It’s the best method to avoid physical interaction in crowded places such as market.
Not only exports, other industries are sluggish as well in South Korea
Industrial production in April eventually decreased by 2.5%. Meanwhile, output in the critical mining, manufacturing, gas and electricity sectors decreased by 6%, Yonhap announced. According to Statistics Korea, this was the steepest monthly fall since December 2008.
The biggest explanation for the precipitous drop rates was that in economies from the U.S. to Europe. Foreign consumers hit even harder by the pandemic simply didn’t buy as normal.
The challenge of obtaining critical supplies was another factor, too. “Local producers have faced obstacles in acquiring crucial components as vendors across the globe have halted their operations in the midst of the pandemic,” Yonhap said. It adds, “large product exports are also hampered by entry bans.”
Exports totaled $36.9 billion in April, down 24.3 per cent year-on-year. It reflects a $950 million trade deficit after eight years and two months of surpluses. Exports decreased 20.3 per cent year-on-year for the first 20 days of May. With motor vehicles and electronics, particularly chips, suffering the worst.
To emphasize this point, statistics were not all negative though. Owing to the relaxation of social distance laws, retail sales in April grew 5.3 percent from March. And domestic motor vehicle sales actually increased 4.1 percent as a result of tax cuts intended to improve manufacturers.
In addition, the government is also extending a helping hand to the two major airlines in the country, the Korean Air flagship and Asiana. To emphasize this point, transport vice minister, Son Myoung-soo, told Yonhap the government would call for a $2.3 billion raise already promised by the Korea Development Bank and Korea’s Export-Import Bank.
