Ssangyong Motor

The country's exports grew 21.1 percent in May from a year ago, the largest gain in 18 months despite

worries that high oil prices and a stronger won may crimp global demand. Exports totaled $28 billion last

month, helped by robust demand for auto parts, liquid crystal display screens and chips in such major

overseas markets as China and the United States, the Ministry of Commerce, Industry and Energy said

yesterday in its monthly report. Asia's third-largest economy has achieved double-digit growth for the

fourth straight month since January when exports climbed 3.6 percent. The government hopes to achieve

a 5 percent GDP growth rate this year backed by strong exports and private spending.

  "The country's strong export performance reflects that the world economy is still doing well amid

projections that the global economy may slow down," said Song Tae-jung, a researcher with LG Economic

Research Institute. "The condition of the global economy is a more important determinant of our export

performance than a strong won. It also looks like high oil prices haven't seriously weakened people's

spending appetite." Commerce Minister Chung Sye-kyun recently said the government is holding onto its

original exports growth forecast of about 12 percent this year. Exports account for about 40 percent of the

national economy.

A stronger won threatens to depress growth in the country's exports as Korean goods become more

expensive in overseas markets. The won has gained more than 7 percent against the dollar so far this year

and crude oil prices touched an all-time high of $73.35 on April 21. Korea, the world's fourth-largest oil importer,

relies on imports for 97 percent of its oil needs. Fears over a widening current account deficit have recently

raised concerns for the country's economic lookout. But the stronger-than-expected export performance

last month lifted the trade surplus to $1.95 billion. Imports rose 23.1 percent from a year ago to $26 billion.

In the first five months of this year, exports climbed 13.1 percent to $127.54 billion while imports rose

18.7 percent to $122.28 billion. This resulted in a trade surplus of $5.2 billion, almost half of the

 $9.78 billion won surplus recorded for the same period in 2005.

The nation's current account deficit in April topped $1.5 billion, the largest since the $1.6 billion posted

in April 1997 during the financial crisis, the Bank of Korea reported last week.

- Source from the Korea Herald(Jun 2nd, 2006)