South Korea will lend government support to boost high-tech export items, including OLED displays and SSDs, by increasing the discount rate on export insurance in an attempt to fend off sluggish trade figures.
South Korean government officials made the announcement on Wednesday during the 11th inter-agency meeting on export promotion measures, organised by the Korea Trade Insurance Corporation and chaired by South Korea's trade minister, to help companies boost their exports on premium high-tech devices. South Korean trade officials are in a panic over 10 straight months of flagging trade figures.
"A poor global economic situation will slow the recovery in the country's exports. So, the government and businesses and other economic actors must pull their strength and work together to boost export growth, as well as domestic demand," said Yoon Sang-jik, Minister of Trade, Industry and Energy, according to media reports.
The move is part of a large scale "second gap" initiative by the trade ministry to boost the country's export competitiveness, including support to growth in OLED related tech and R&D in next-generation semiconductors.
In that effort, South Korea will decrease tariff quota rates on OLED-related components by as much as 8 percent going forward, and extend tax breaks on R&D for new display technology.
South Korean exports in September fell by 15.8 percent year over year to $43.47 billion, the sharpest decline in six years, according to figures by the country's trade ministry. But it also noted an encouraging upward trend for solid state drives.
Exports of high tech devices were a glimmer of light amid the gloom for the country in October. In particular, shipments of solid state drives increased 25 percent and OLEDs were up 29.1 percent.
South Korean exports have been declining every month since January. The downturn was blamed on low world oil prices and exports affected by the shipping industry. Exports make up about half of the country's GDP, with a considerable proportion of them going to its two largest trade partners China and the US.