Korea's Export Engine Slips into Reverse as Japan Steps on the Gas

[Bussard Ramjet]

I am not saying it is not a good strategy. Korea's strategy is nice with respect to its population and territory size. Ideally you would have a complete industrial base that covers all sectors, but not every nation can do it. South Korea picked one that is suitable for them. Just because the strategy is good doesn't mean it is without drawbacks.

To be frank, their strategy has been well balanced in that thing as well. They are major exporters of Cars, ships, display panels, semiconductors, cosmetics, media, memory panels etc. While these things may individually be small, they are pretty wide spread out, and if all the industries listed fail, that means the general world economy is failing by most probability.

Also, trade is all about comparative advantage, and Korea being such a small country must be given credit for its achievements and total dominance of certain sectors. Also, these sectors by the way have a lot of growth potential in the near and medium term.

I don't see where it's overplayed: if China's exports to the US suddenly vanished, China would enter a major depression (and probably the US would as well). Here are the points to consider:

1) Is it easier to replace a supplier (supply), or an export market (demand)?
2) Who is harmed more by the cessation of trade, the country with the trade surplus, or the country with the trade deficit?
3) Which country depends more on exports to power its economic growth?

Based on these three points, I believe that the balance of power still remains with the US (i.e. China still needs the US more than the US needs China). I say this not as a matter of pride, but rather to counter the creeping attitude of condescension and dismissiveness that I see on the part of some of our Chinese friends.

We are bound together by trade. Talk of cutting off trade, or destroying each other economically (or military) is futile at best, ignorant at worst. It's time to embrace reality, we are in a symbiotic relationship, and weakness on the side of either is most unwelcome. I want to see China prosper, because that can only be good for America. I would like to remind our Chinese friends that the reverse is true as well, as much as they hate to admit it.

Very well said.
Though it is not entirely necessary sometimes that a supplier is the one who will suffer due to closing off markets. There are some things in the world which only the Chinese make, and setting up any manufacturing base to create them can take years.
So I am just writing this as a concept, I don't know what are the actual dynamics of this particular case, and someone will have to do a detailed study on US-China trade.

 

[JSCh]

When I am reading reports like these, these newspapers must explain what they mean by statements like "the trade balance will remain in negative."
For people like us, that means negative territory, but I hear, that for China and Japan that means positive. So what do I take away?
@Nihonjin1051

I think that mean that Japan overall trade balance (export - import) were expected to remain in negative/deficit.