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  • Last Year, Air Transportation Took up 35.7% of Total Exports, the Highest Ever Amid COVID-19 Pandemi
    2021-03-16 hit 533

    Last Year, Air Transportation Took up 35.7% of Total Exports, the Highest Ever Amid COVID-19 Pandemic

     

    - Compared to 2019, the proportion of air transportation increased by 5.4%p, and sea transportation decreased by 5.6%p -

    - Need to actively resolve logistics difficulties such as rising freight rates and a shortage of empty containers -

     

    With the rise in demand for air transportation amid a significant increase in logistics difficulties for export companies due to the spread of COVID-19 last year, the proportion of air transportation exports recorded a record high of 35.7 percent.

     

    According to a report titled, “2020 Air and Sea Export Logistics Trends and Implications” issued by the Institute for International Trade (President: Choi Yong-min) of the Korea International Trade Association, last year, Korea's total exports were 512.5 billion dollars, air transportation exports were 188.3 billion dollars accounting for 35.7 percent of the total, and sea transportation exports were 325.8 billion dollars taking up 63.5 percent of the total. Compared to 2019, the proportion of air transportation increased by 5.4 percent point, while the sea transportation declined by 5.6 percent point.

     

    It is analyzed that the rise in air freight exports is due to the increase in exports of light and high value-added products such as semiconductors, next-generation mass storage devices such as SSD (Solid State Drive) and organic light-emitting diodes (OLED) and pharmaceuticals. As a result, exports of pharmaceuticals and computers by air last year increased 79.7 percent and 77.3 percent, respectively, compared to the previous year, and the exports of flat panel displays (21.6%) and semiconductors (15.8%) also rose dramatically.

     

    On the other hand, sea transportation experienced difficulties such as a surge in freight rates, port congestion, and a shortage of empty containers due to the outbreak of coronavirus. In particular, sea transportation exports of petroleum products, steel, and automobiles, which account for more than 98 percent of sea transportation, were sluggish as they declined by 40.6 percent, 14.7 percent, and 13.3 percent, respectively. In the case of flat panel displays, shipping exports were 6.4 billion dollars more than air transport in 2019, but the gap narrowed to 1.1 billion dollars in 2020.

     

    The report anticipated that the international trade volume and Korea's exports are expected to expand on the back of economic recovery in major countries, but it predicted that logistics difficulties such as strong freight rates and delays in resolving the congestion in port logistics due to increase in cargo volume, increase in vaccine transportation demand, and increase in oil prices will continue for the time being. According to a recent survey of 945 domestic export companies conducted by the Institute for International Trade, the companies selected the “increased raw material price” (21.0%) and “logistics cost increase” (20.3%) as the factors that they assume to be the most difficult in the second quarter of this year.

     

    Kang Sung-eun, a researcher at the Institute for International Trade of the Korea International Trade Association, said. “In order to resolve the logistical difficulties of exporting companies, supports to curb excessive freight rates and expand the supply of empty containers to enable timely transportation are required.”


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