75% of S. Korea’s key imports come from China, analysis shows

Posted on : 2022-05-31 17:10 KST Modified on : 2022-05-31 17:10 KST
The report's author proposed establishing a monitoring system for key imports to prevent supply crises
Shipping containers fill a yard in Busan Port in this undated photo. (Yonhap News)
Shipping containers fill a yard in Busan Port in this undated photo. (Yonhap News)

In its trade with the US, China, and Japan, South Korea relies on imports from China for three-quarters of key items that account for a large portion of import dollar value, an analysis shows.

According to an analysis published Monday on a study carried out by Chonbuk National University professor Choi Nam-suk at the request of the Federation of Korean Industries, 172 out of 228 items (75.5%) considered to be “key imports requiring management” originated in China.

Japan represented another 32 (14.0%), while the US accounted for 24 (10.5%).

For the report, the category of “key imports” was assigned to 228 items where South Korea relies on three countries — the US, China, or Japan — for over 90% of imports, and which rank in the top 30% in terms of import dollar value.

Some of the key import items produced in China include electronics, machinery/computers, steel, organic and inorganic compounds, glass, medical products, and industrial raw materials such as non-ferrous metals.

Prominent examples of Chinese imports include manganese, which is critical for steel manufacturing; graphite, which is an essential electric vehicle battery anode material; and magnesium, which is important for lightweight automobile production.

Key imports from Japan include electronics, machinery/computers, plastics, and organic compounds for electronics. Some of the Japanese-made items requiring management include polyimide film, which is used for foldable displays, and machinery and spraying equipment for processing semiconductor wafers.

Key imports from the US include petroleum/coal, aircraft, electronics, fruit, and machinery/computers.

Identifying 133 items as having global supply chain stability vulnerabilities with high volumes of transactions between companies, the report called for the establishment of an early warning management system for them. Chinese-made items accounted for 127 of them, or 95.4%, including tungsten oxide (used in semiconductors), calcium chloride, graphics cards, solar cell modules, and pesticide ingredients.

“Failure to manage supply and demand for key import items could result in supply crises erupting at any time, as witnessed with the urea water solution situation,” Choi said.

“An ongoing monitoring system will need to be established for the 228 items, along with measures such as import diversification,” he added.

By Kim Hoe-seung, senior staff writer

Please direct questions or comments to [english@hani.co.kr]

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