South Korea trade remains strong, but currency pressures persist in World Economy News 03/06/2026 Widening trade surplus signals firm growth in 2Q26 South Korea’s exports increased a greater-than-expected 53.2% year-on-year in May (vs 48.0% in April, 49.3% market consensus, 52% ING). Despite the ongoing conflict in the Middle East, export growth accelerated, with working day-adjusted shipments jumping 60.7%. Exports for the first five months rose 43.4%, compared to 40.9% year-to-date in April. Semiconductor exports surged by 169.4%, driven by strong global investment in the AI sector. It accounts for 42.3% of total exports. Other AI-related products – computers (290.7%), wireless equipment (12.6%), and displays (9.4%)- all gained. The growth momentum will likely accelerate throughout 2026 as the structural supply shortage of chips continues. Exports should benefit not only from rising US investment in AI, but also from the surge in Chinese AI spending — both engines are set to lift demand for Korea’s goods. By destination, shipments to the US increased by 59.1% with chip and computer exports rising 651% and 675%, respectively. Exports to China rose by an even steeper 80.9%, with semiconductor exports (243%) accounting for the majority of this growth. For other major exports, car exports fell 5.9% due to US tariffs and logistics disruptions caused by the war in the Middle East, while ship exports increased by 16.7%. Energy supply shocks had mixed effects on Korean exports as petroleum product exports increased in value (46.6%) but decreased in volume (-23.8%). The government has imposed an export ban on oil and petrochemical products. This should continue to weigh on these exports. Imports up firmly amid higher energy prices and capital goods imports Imports rose 20.8% in May (16.7% in April, 21.5% market consensus; 25% ING), mostly driven by higher energy prices. Energy import volume dropped, but the value increased 15.9%. Non-energy imports also grew, with semicond