Chips, AI Keep South Korea's Export Engine Firing on All Cylinders — Update

By Kwanwoo Jun

South Korea's exports grew at the fastest pace in more than four decades in May, as artificial intelligence-driven demand for chips pushed the value of shipments to a record high.

The result underscores how countries like Korea--home to top memory-chip makers Samsung Electronics and SK Hynix--continue to benefit from the AI buildout despite persistent geopolitical headwinds, including the Middle East crisis.

Exports from Asia's fourth-largest economy surged 53.2% from a year earlier to $87.75 billion in May, notching the quickest expansion since January 1984 and the highest-ever monthly export value.

That compared with April's 48% gain, and beat the median forecast for a 50.8% rise in a Wall Street Journal survey.

Imports expanded 20.8% to $60.80 billion in May, according to preliminary trade ministry data released Monday. That resulted in a trade surplus of $26.95 billion, following the previous month's revised surplus of $23.76 billion.

Shipments of semiconductors and related products continued to drive South Korea's export growth, outweighing weakness in other sectors.

Chip exports reached a new monthly all-time high of $37.16 billion in May, nearly tripling from a year earlier. They have remained above $30 billion for the third straight month since crossing the mark for the first time in March.

The breakneck pace of growth suggests demand for AI-related semiconductors remains strong, despite concerns that global economic headwinds could eventually damp infrastructure spending.

Monday's data showed that while South Korea's technology sector, including semiconductors and computers, outperformed in May, other industries stagnated or contracted amid higher raw-material costs, supply constraints and logistics challenges linked to the Middle East conflict.

Exports of computers nearly quadrupled from a year earlier in May, while shipments of vehicles and steel fell 5.9% and 2.1%, respectively, the data showed.

Shipments to the Middle East fell 7.7% year-over-year during the month, while those to the U.S. and China rose 59.1% and 80.9%, respectively.

Even with the war in Iran driving up prices of fuel and key inputs needed for high-tech production, most analysts expect South Korea's chip-led export growth to continue through the year as AI-driven demand holds up against costs pressures.

Write to Kwanwoo Jun at kwanwoo.jun@wsj.com

(END) Dow Jones Newswires

May 31, 2026 22:23 ET (02:23 GMT)