South Korea's exports to China dropped in April, highlighting the impact that Covid-related lockdowns in Chinese cities are having on supply chains around the region.
The South Korean trade ministry said in a release on Sunday that shipments to China fell 3.4% from a year earlier. Semiconductor sales increased by 15.8% last month.
South Korea has a manufacturing capability that spans from chips to displays and refined oil. Its trade performance is a heat map for global economic activity because of the diversity of destinations for its overseas shipments.
Demand in Europe and China has been affected by Russia's invasion of Ukraine and the country's Covid-Zero policy. The twin risks to the global economy have caused renewed disruptions in supply chains.
A strong recovery in the U.S. has helped maintain the strength of South Korean exports. Major exporters of technology products such as displays and Semiconductors are able to report a surge in earnings because of the resilience of demand.
South Korea's heavy reliance on trade means it needs exports to hold up in order to prevent the economy from slowing further. The central bank is trying to rein in inflation, which is higher than expected. It was one of the first to raise interest rates.
With assistance from Myungshin Cho.
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