South Korean Trade Ministry Expects Serious Damage From US-China Trade Dispute
South Korean trade ministry stated that US-China trade war will harm exports of "intermediary goods" used to make home appliances, computers and communications devices. It’s expected to be "prolonged and spread".
The Deputy Minister for Trade Kang Sung-chun said: "We have detailed analysis (on which products will be affected by the U.S.-China trade war)", And: "The impact will be mixed. There will be both positive and negative effects. Some Korean exports could replace Chinese goods to be slapped with tariffs, for example".
Finance Minister Kim Dong-yeon noted: "While the trade conflict between the U.S. and China has had a limited impact so far, we can't rule out the possibility of a slowdown in the Chinese economy and a contraction in world trade should conflict grow and spread into the global market."
Singapore’s Bank said in a statement: “China's closest neighbors, namely Japan, Korea and Hong Kong, are most vulnerable to a U.S.-Sino trade war because they export mostly intermediate goods to China."
According to the Bank, if US hits China with tariffs on 250 billion dollars of Chinese imports, South Korea's GDP growth could be harmed by 0.3 of a percentage point and Japan's growth could be damaged by 0.2 of a percentage point. South Korea's central bank revised down its growth projection from 0.3% to 2.9% due to the trade war.