Exports Expected to Reach US$2.5 Bil in 2014
In 2014, Korea's machine tool exports are expected to grow 13.1% year-on-year to US$2.5 billion. The double-digit growth projection has the potential to be realized owing to a 3%-level growth of the global economy, continuation of economic recoveries in the Unites States and eurozone and recovery of exports to BRICs, which were more or less sluggish in 2013. Strengthened exploration of overseas markets and utilization of already-concluded FTAs by domestic enterprises and the possibility of concluding a Korea-China FTA also are likely to serve as positive export growth factors.
In addition, favorable conditions for increased demand also include expanded overseas production by domestic carmakers, such as production at the third plant in China, full-fledged local production in Brazil and plant facility expansion in Turkey by Hyundai Motor and Kia Motors.
Amid this environment, the domestic machine tool industry is expected to stage active overseas marketing activities in 2014 with a focus on leading overseas machine tool exhibitions in India, China, Germany, Italy, Turkey, Japan, etc.
On the other hand, a slower recovery of the global economy, possibility of the U.S. tapering of quantitative easing, unrest in financial markets in emerging countries and uncertain economic vitality in developing countries as well as a continuation of China's investment adjustment have the potential to be stumbling blocks.
In the midst of a mid-7% level of low growth projected due to China's restructuring going into full swing, the possibility of a financial crisis in some South and Southeast Asian countries, including India and Indonesia, may be the largest variable.
In 2014, Korea's machine tool exports may near the record-high results of 2012 (US$2.55 billion) but it will be hard to set a new record. Meanwhile, fierce competition is expected in the global machine tool market in 2014 due to continuation of Korean won currency appreciation and Japanese yen depreciation, expanded overseas production of low-priced machine tools and strategic alliances between the world's machine tool manufacturers.