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Korea Report - November 2022 |
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Author : Hwang & Co
Date : 22-12-07 15:49
Hit : 17671
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Korea Report - November 2022.pdf (1.3M), Down : 11, 2022-12-07 15:49:34 |
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F : +82-31-706-1390
E : hwangnco@hwangnco.com
H : www.hwangnco.com
KOREA REPORT - NOVEMBER, 2022.
President
Yoon arrived in Bali, Indonesia, on 14th, for a three-day visit to attend Group
of 20 (G-20) summit. On 14th, Yoon took part in
SKorea-Indonesia business roundtable and B-20 summit involving businesses from
G-20 nations. On 15th, he attended first day of G-20 summit, and gave speeches
at one session on food, energy, and security, and another on health. Before arriving in Bali, Yoon attended
multiple summits in Cambodia with ASEAN nations, the US, Japan and China. President
Yoon on 11th unveiled the country's first Indo-Pacific strategy for freedom,
peace and prosperity for the region, at biannual ASEAN summit. Yoon highlighted
the importance of maintaining peace and stability in the Indo-Pacific region,
which has gained increasing strategic importance amid the US-China competition,
and said any unilateral change in the status quo by force should not be
tolerated. Experts here say Korean version of the Indo-Pacific strategy shows
that SKorea has aligned its diplomatic course to lean toward the US, and
conflict with China may be inevitable.
Saudi
Arabia's Crown Prince and PM Mohammed bin Salman arrived in Seoul on 17th to hold talks with President Yoon and top business leaders,
initiating a slew of agreements worth an estimated $30 bil between the two
countries. The crown prince¡¯s trip to Seoul is his first in three years. In a
closed meeting, the two agreed to develop bilateral relations into a
¡°future-oriented strategic partnership¡± and establish a ¡°strategic partnership
committee¡± at the leadership level to promote cooperative projects more
systemically. Yoon said he hoped to ¡°further expand and develop cooperation¡±
with Saudi Arabia in various sectors, including $500 bil Neom City project,
among others. Read more¡¦
The
nationwide strike by truck drivers caused supply disruptions across the cement
and steel industries, with other sectors like auto
and petrochemicals feared to bear the brunt if the protest prolongs. Cement
factories were unable to ship most of the daily supply of 200,000 tons the
previous day. The strike delayed the cement deposit work at construction sites
across the country, and the ready-mix cement producers said they will have to
suspend operation. Truck drivers went on strike on 24th, the second strike this
year in less than six months, after staging an eight-day walkout in June, which
resulted in massive delays in cargo shipments and production disruptions worth
around KW1.6 tril ($1.21 bil) in damage. They demand that the government extend
temporary rules guaranteeing minimum freight rates, citing high fuel prices.
The rules are set to expire at the end of this year. Read more¡¦
NK's
latest firing of more than 10 ballistic missiles, one of which landed south of
the de facto maritime border for the first time,
reflects the regime's confidence in its military capabilities and its
determination to cement its status as a nuclear-armed state, Seoul-based
experts said on 2nd. The short-range ballistic missile that crossed Northern
Limit Line fell into high sea 57 km east of SKorea¡¯s eastern city of Sokcho and
167 km northwest of Ulleung Island near Dokdo. Experts viewed the unprecedented
provocation as a possible "prelude" to further raise military
tensions in the region before NK carries out its seventh nuclear test. NK will
likely to continue to ratchet up military tension on the Korean Peninsula, as
it would want to cement its status as a nuclear-armed state, with its seventh
nuclear test as a finale. Pyongyang would then want to lead negotiations
directly with the US, holding its status as a nuclear-armed state, experts
said.
SKorea
recorded trade deficit of $7.01 bil in Nov, eighth straight month of deficit, ringing an alarm over its growth momentum. Outbound shipments
fell 14% on-year to $51.91 bil, due to global economic slowdown and logistics
disruptions over a truckers' strike. Imports grew 2.7% on-year to $58.93 bil on
high global energy prices. Overseas sales of semiconductors tumbled 29.8%
on-year to $8.45 bil on falling demand and the drop in chip prices. Sales of
petrochemicals also fell 26.5% to $3.55 bil and exports of steel products
decreased 10.6% to $2.99 bil. Exports of ships sank 68.2% to $1.12 bil. Car
exports jumped 31% to $5.4 bil, an all-time monthly high, and sales of
petroleum products advanced 26% to $4.88 bil.
Corporate
Korea is betting big on Indonesia¡¯s $34 bil capital relocation plan as they are expected to play leading role in building futuristic
infrastructure for smart city and flying cars. During G20 summit, SKorea and
Indonesia signed total of 10 MOUs on 14th to boost economic partnership between
two countries, whose official ties will reach the 50th anniversary next year.
The 10 agreements, consisting of six government and four private led projects,
cover range of topics across sectors, including digital transformation,
carbon-free energy transition and resources and infrastructure development.
Korean businesses pinned especially high hopes on Indonesian leader Joko
Widodo¡¯s pet project, relocating country¡¯s capital city from Jakarta to
Nusantara, new forest city on island of Borneo. Read more¡¦
SKorea's
foreign reserves increased $2.09 bil on-month to $416.1 bil as of end Nov, as the dollar-converted value of holdings rose thanks to the
greenback's fall, according to Bank of Korea. It marked the first growth in
four months. The dollar index weakened about 3.5% in Nov. Of the total
reserves, foreign securities, such as US Treasuries, were valued at $365.62
bil, which accounted for 87.9% of total foreign reserves. The value of deposits
stood at $26.68 bil. SKorea was ranked world's ninth-largest holder of foreign
reserves as of end Oct.
Bank
of Korea raised its policy rate by 0.25% to 3.25% on 24th, returning to its usual pace of tightening as growth and credit
markets falter in the face of 24 year high inflation. BOK policymakers expect
the rate to peak at 3.5%, noting it was too premature to discuss loosening
policy.
SKorea¡¯s
consumer prices rose 5% on-year in Nov,
according to Statistics Korea. It marked the lowest on-year increase since 4.8%
tallied in April. Price of utility services gained 23.1% on-year, amid soaring
energy prices sparked by prolonged war between Russia and Ukraine. The
price of agricultural, fisheries and livestock products moved up 0.3% on-year,
sharply slowing from Oct's on-year rise of 5.2%. Industrial product prices
increased 5.9% on-year, with those of processed foodstuffs and petroleum
products rising 9.4% and 5.6%, respectively. Core inflation rose 4.3% on-year
in Nov.
Korea¡¯s
Big3 released their 3Q business results. KSOE posted revenue of KW4.26 tril ($2
bil), operating profit of KW189 bil and net profit of KW316 bil in third
quarter. The sales increased by 1.8% on-quarter and succeeded in
turning into a surplus. Its sales, operating profit, and net profit in third
quarter all increased by 19.9%, 33.2%, and 64% on-year, respectively. SHI posted net loss of KW202 bil in July-Sept
period. Sales fell 5.7% on-year
to KW1.4 tril, with operating loss growing to KW167.9 bil from a loss of
KW110.2 bil a year earlier. DSME
logged revenue of KW981 bil, operating loss of KW628 bil and net loss of KW647
bil in third quarter. The sales decreased 17% on-quarter, but showed 2.3%
on-year upturn. DSME's operating loss increased more than six-fold
compared to second quarter, and by 33 times against a year ago. Its net loss
also saw increase from KW176 bil in 2Q 2022 and KW54.5 bil in 3Q 2021.
Despite
market disorientation caused by high shipbuilding prices and economic downturn,
KSOE has shown excellent performance in new order sales this year. KSOE has been awarded 190 newbuilds worth $22.82 bil, so far
this year, 130.8% of its annual goal. Last year, KSOE surpassed its goal by
53%. Park Seung-yong, senior
executive VP of HHI, said ¡°The Group secured 42 LNG carriers, 51 large
container vessels, and 43 small boxships. Nearly 80% of newbuildings that were
ordered at HHI and HSHI were dual-fueled vessels as compared to last year¡¯s
40%.¡± The slots for LNG carriers in HHI and HSHI are booked until end of 2026,
and not taking new order enquiries for 2027 deliveries actively since the cost
is uncertain. However, slots for 2025 for conventional commercial vessels
(container ships, tankers, etc) are not full yet.
Korea
Shipbuilding Industry Cooperative (KOSIC) recently announced that its member,
Asia Shipbuilding and KOSTEC consortium, have won a wind-assisted propulsion
supply vessel worth KW5.4 bil ($4.0 mil) from German International Cooperation
Agency (GIZ). With dimensions of 48m in length, 8.7m in
width and 4.1m depth, the new vessel is expected to be delivered in Oct 2023.
The 285 dwt vessel will be equipped with large-sized sail to minimize carbon emissions
from diesel engine. After completion, GIZ plans to donate the newbuilding to
Marshall Islands. Also, the German corporation is going to purchase additional
sister ships and donate them to countries such as Fiji and Micronesia in the
future. Read more¡¦
Korean
Big3 have started developing small nuclear reactors. KSOE signed $30 mil
investment contract with TerraPower on 4th. SHI signed MOU with Danish Seaborg in
April for developing floating nuclear power plants based on Seaborg¡¯s compact
molten salt reactor (CMSR). DSME
signed MOU with Kepco E&C for floating nuclear power plant development
cooperation. Read more¡¦
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ATTACHMENT: Korea Report - November 2022 (PDF FILE) Please let us know if you have difficulty opening the file.
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