December 17, 2012 14:32
The overseas plants of Korean companies have benefited Korean exports even though they take revenues from finished products out of the country.
The Ministry of Knowledge Economy on Sunday said revenues from Korean products manufactured overseas rose from the equivalent of 24.6 percent of Korea's export earnings in 2005 to 51.4 percent in 2010.
Korea's exports totaled US$466.4 billion in 2010.
When Korea's industrial structure became more advanced in the 1990s, manufacturers increasingly invested in countries where labor costs are cheaper. This slowed exports of consumer goods like electronic appliances but increased those of raw materials such as steel and chemical products and capital goods such as machinery and parts.
Machinery and parts exports quadrupled from $62 billion in 2001 to $255.3 billion in 2010 as overseas investment in manufacturing rose from $3.9 billion to $7.1 billion over the same period. The growth was particularly noticeable in China and ASEAN countries where many Korean companies have their production facilities.
Korean automakers produced 3.3 percent of their car in overseas plants in 2001 but that rose to 40.3 percent last year, leading to a rise in exports of automotive parts from $2.2 billion to $23 billion over the same period, mostly to the U.S., China, Russia, India, Slovakia and Czech, where Korean carmakers have factories.
In the IT industry, exports of mobile phones declined due to increased production overseas, but exports of computer chips and circuit components increased.
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