Friday, March 7, 2014

[KMTI ➇] Korea's General '14 Machinery Exports

Korea's General '14 Machinery Exports 
Seen to Cross the US$50 Bil. Level

Korea's exports of general machinery in 2013 were estimated at US$47.6 billion, generating a trade surplus of US$13.2 billion for the sector, according to the Korea Association of Machinery Industry (KOAMI).

The association put forward the optimistic projection that exports of general machinery would increase 8.7% year-on-year and post US$51.6 billion in 2014.

First of all, facility investment is expected to expand, led by largescale plants, with the flow of the domestic economic conditions improving. The projection that overseas demand for machinery may rise to a certain extent also is a favorable factor. Of particular note, the move of manufacturers in the U.S., and other advanced countries toward 'Reshoring' - relocating their overseas production facilities back to their own countries - is expected to drive export growth.

It is noteworthy that, recently, newly emerging countries, including China and ASEAN countries, are increasing imports of machinery. However, the fact that the price competitiveness of Korean machinery is declining compared with Japanese products due to the weaker Japanese yen continuing since 2013 and a persisting slowdown of the Middle East economy may serve as negative factors for Korea's exports.

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