One in three major South Korean export companies anticipates a decrease in exports next year. (Image courtesy of Yonhap)
SEOUL, Dec. 24 (Korea Bizwire) — A recent Bank of Korea survey reveals that one in three major South Korean export companies anticipates a decrease in exports next year, citing intensifying competition from China and potential impacts from a second Trump administration among key concerns.
According to the central bank’s regional economic report released on December 23, 32.5% of the top 20% of exporters (40 companies out of 200 surveyed) forecast a decline in exports for the coming year. The survey, conducted from November 9 to 30, showed that 2.5% of respondents expect a decrease of more than 10%, while 10% anticipate a 5-10% drop, and 20% predict a decline of up to 5%.
The remaining 67.5% of companies maintain a more optimistic outlook, with the majority (32.5%) projecting a modest increase of 0 to 5%, followed by 27.5% expecting 5 to 10% growth, and 7.5% forecasting growth exceeding 10%. However, 42.5% of respondents believe their export growth rate will be lower than this year.
When asked about negative factors affecting exports next year, surveyed companies identified China’s overcapacity and low-price exports as the most significant concern, scoring 27 points out of 100. This was followed by economic slowdown in major export destinations (19.5 points) and growing global protectionism amid U.S.-China tensions (17.9 points).
Technological competition from China has emerged as a particular concern. About 33.3% of respondents indicated that Chinese companies have already achieved technological parity with South Korean firms, while 49.7% described the narrowing gap as “worrying.” This sentiment was particularly strong in sectors including secondary batteries, machinery, steel, and metal products. Even in the semiconductor industry, over 60% of companies expressed concern about diminishing technological advantages.
Regarding potential Trump administration trade policies, 39.5% of companies anticipate negative impacts, though a larger portion (47.4%) expect limited effects. Companies citing minimal impact pointed to factors such as higher U.S. tariffs on Chinese goods improving their relative competitiveness (32.2%), limited export exposure to the U.S. and China (26.1%), and strong product competitiveness and demand (17.4%).
The report also highlighted the growing dominance of the Seoul metropolitan area in exports, which reached a record 43.6% share of total national exports in October and November, driven by high-bandwidth memory (HBM) semiconductor exports. The Bank of Korea noted that companies in this region showed more optimistic export outlooks and less concern about Chinese competition and U.S. trade policy changes.
The central bank emphasized the importance of developing high-value-added products through research and development to maintain market leadership against Chinese competition, given the challenging external conditions expected next year. It also called for strengthened cooperation between government and business to effectively address uncertainties in global trade policies.
Ashley Song (ashley@koreabizwire.com)
