Vietnam returned as South Korea’s third-largest trading partner for the second consecutive year in 2023 amid slowing exports and imports from the Southeast Asian country.
Data from the Korea International Trade Association (KITA) released Monday showed South Korea’s trade with Vietnam reached 79.43 billion U.S. dollars in 2023, with exports falling 12.3 percent to 53.49 billion U.S. dollars.
Imports from Vietnam over the year also edged down 2.9 percent to USD $25.94 billion (IDR 408.3 trillion) and the trade surplus with South Korea shrank 19.5 percent to USD $27.55 billion (IDR 433.6 trillion).
KITA attributes the decline in trade and exports to Vietnam in 2023 to the decline in chip exports. South Korea’s semiconductor shipments to Vietnam plunged 21.6 percent on an annualized basis to US$12.73 billion in 2023.
Four other exports, namely flat panels and sensors, petroleum products, wireless communication equipment and synthetic resins also fell last year.
Despite the decline, Vietnam was able to surpass Japan and maintain the third position of South Korea’s trading partner for the second consecutive year.
South Korea’s trade with Vietnam has grown rapidly since the two countries established diplomatic relations in 1992, when bilateral trade at that time only reached 500 million US dollars (Rp7.86 trillion).
Bilateral trade volume further increased as South Korea and Vietnam signed a free trade agreement in 2014. Vietnam was South Korea’s eighth-largest trading partner that year, but its ranking jumped to fourth place a year later. In 2022, Vietnam surpassed Japan and became South Korea’s third-largest trading partner for the first time.