Officially named the Republic of Korea, South Korea is strategically located between the world-class importers namely China to its west and another economic powerhouse Japan to South Korea’s east.
South Korea shipped US$605.2 billion worth of products around the globe in 2018. That figure represents roughly 3.4% of overall global exports estimated at $17.546 trillion for 2017.
From a continental perspective, two-thirds (67%) of South Korea’s exports by value were delivered to other Asian countries while 14.9% were sold to North American importers. South Korea shipped another 11.4% worth of goods to Europe. Smaller percentages arrived in Latin America (2.6%) excluding Mexico but including the Caribbean, Oceania (2.3%) led by Australia then Africa (1.7%).
South Korea’s Top Trading Partners
Below is a list showcasing 15 of South Korea’s top trading partners in terms of export sales during 2018. That is, these are countries that imported the most Korean shipments by dollar value. Also shown is each import country’s percentage of total Korean exports.
- China: US$162.2 billion (26.8% of total South Korean exports)
- United States: $73.1 billion (12.1%)
- Vietnam: $48.6 billion (8%)
- Hong Kong: $46 billion (7.6%)
- Japan: $30.6 billion (5.1%)
- Taiwan: $20.8 billion (3.4%)
- India: $15.6 billion (2.6%)
- Philippines: $12.1 billion (2%)
- Singapore: $11.9 billion (2%)
- Mexico: $11.5 billion (1.9%)
- Australia: $9.6 billion (1.6%)
- Germany: $9.4 billion (1.5%)
- Malaysia: $9 billion (1.5%)
- Indonesia: $8.9 billion (1.5%)
- Thailand: $8.5 billion (1.4%)
Almost four-fifths (78.9%) of South Korean exports in 2018 were delivered to the above 15 trade partners.
Australia was the only top importers that decreased its purchases from South Korea from 2017 to 2018, down in value by -51.5%. Among the other 14 countries, gains ranged from a minimum of 1.7% versus Singapore up to 39.7% versus Taiwan.
As defined by Investopedia, a country whose total value of all imported goods is higher than its value of all exports is said to have a negative trade balance or deficit.
It would be unrealistic for any exporting nation to expect across-the-board positive trade balances with all its importing partners. Similarly, that export country doesn’t necessarily post a negative trade balance with each individual partner with which it exchanges exports and imports.
In 2018, South Korea incurred the highest trade deficits with the following countries:
- Japan: -US$24 billion (country-specific trade deficit in 2018)
- Saudi Arabia: -$22.4 billion
- Qatar: -$15.8 billion
- Kuwait: -$11.5 billion
- Germany: -$11.5 billion
- Australia: -$11.1 billion
- Russia: -$10.2 billion
- Iraq: -$7.7 billion
- United Arab Emirates: -$4.7 billion
- Chile: -$2.7 billion
South Korea reversed $725.2 million in black ink during 2017 incurring -$11.1 billion in red ink for the most recent period.
Among South Korea’s other trading partners that cause the greatest negative trade balances, South Korean deficits with Russia (up 98%), Iraq (up 56%) and Saudi Arabia (up 55.4%) grew at the fastest pace from 2017 to 2018.
These cashflow deficiencies clearly indicate South Korea’s competitive disadvantages with the above countries, but also represent key opportunities for South Korea to develop country-specific strategies to strengthen its overall position in international trade.
Overall, South Korea posted a $70 billion trade surplus for 2018 down from $95.3 billion one year earlier.
Based on Investopedia’s definition of net importer, a country whose total value of all imported goods is lower than its value of all exports is said to have a positive trade balance or surplus.
In 2018, South Korea incurred the highest trade surpluses with the following countries:
- China: US$55.7 billion (country-specific trade surplus in 2018)
- Hong Kong: $44 billion
- Vietnam: $29 billion
- United States: $14 billion
- India: $9.7 billion
- Philippines: $8.5 billion
- Mexico: $6.4 billion
- Turkey: $4.8 billion
- Taiwan: $4.1 billion
- Singapore: $3.9 billion
South Korea reversed a -$3.2 billion deficit trading with America in 2017, earning a $4.1 billion surplus in 2018.
Among South Korea’s other trading partners that generate the greatest positive trade balances, South Korean surpluses with Singapore (up 41.1%), China (up 25.8%) and Philippines (up 23.2%) grew at the fastest pace from 2017 to 2018.
These positive cashflow streams clearly indicate South Korea’s competitive advantages with the above countries, but also represent key opportunities for South Korea to develop country-specific strategies to optimize its overall position in international trade.
Companies Servicing Korean Trading Partners
According to Korea Trade World’s directory, the following are examples of entrepreneurial companies that ship products from South Korea to its trading partners around the globe. Shown within parenthesis are examples of products that the Korean business specializes in.
- Auk Corp. (electronics transistors, diodes)
- Changeui Medical Co. Ltd (orthopedic/ambulatory/rehab appliances)
- Dana Biz Co. (home entertainment, security systems)
- Dyna Solution Co., Ltd. (metal-cutting/forming fluids, special oil)
- Kaps Korea Auto Parts Servies Co. Ltd (vehicle parts, accessories)
- Koinonia (iron ore, steel scrap)
- Manda International Co. Ltd (computer peripherals)
- P.K. Chemicals, Inc. (petrochemicals, additives)
- Rits International Korea (oil, gas)
- Segae Precision Co. Ltd (disposible syringes)
- YM Corp (mobile phone/GPS jammers)
See also South Korea’s Top 10 Exports, South Korea’s Top 10 Imports, Top South Korean Trade Balances and Top Asian Export Countries
The World Factbook, Field Listing: Imports – Commodities, Central Intelligence Agency. Accessed on January 20, 2019
Trade Map, International Trade Centre, www.intracen.org/marketanalysis. Accessed on January 20, 2019
Investopedia, Net Importer Definition. Accessed on January 20, 2019
Korea Trade World, South Korean Suppliers. Accessed on August 5, 2016