SEOUL, Dec. 30 (Korea Bizwire) – South Korea’s textile and garment industry is set to suffer a trade deficit for the second consecutive year in 2016 amid an influx of cheap Chinese products, industry data showed Friday.
According to the data compiled by the Korea International Trade Association (KITA), the segment’s exports dipped 4.8 percent on-year to reach US$12.4 billion in the first 11 months of the year.
In contrast, imports of textiles and clothing increased 1 percent to $13.52 billion over the cited period. If the trend continues this month, inbound shipments may top the previous record high of $14.65 billion set in 2014.
In the January-November period, the sector logged a trade deficit of $1.09 billion, far surpassing last year’s deficit of $157 million, the data showed.
The textile industry logged a deficit for the first time last year in its history, as high labor costs and increased competition from foreign rivals, such as China, ate into its profitability.
For instance, South Korea shipped textiles and clothing worth $2.22 billion to China last year, but its imports from the neighboring country stood at $6.45 billion, resulting in a trade deficit of $4.23 billion.