S. KOREA'S EXPORTS AND COVID-19 OUTBREAK

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South Korea's exports grew last month, despite the COVID-19 outbreak. But analysts warn that the growth would be short-lived unless the epidemic is contained soon.

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​Hyundai Motor's Ulsan factory came to a halt again last Friday. The suspension came after a worker was confirmed to have COVID-19 on that day. The factory resumed operation on Monday. The temporary closure is an another hit to the automaker, which is already having difficulty procuring parts from China. With disruptions in production, automobile exports dropped 16.6 percent on-year in February.

[Soundbite] HONG NAM-KI(FINANCE MINISTER(FEB. 28)) : "It is the undeniable reality that South Korea will have to bear a greater burden, given its close economic relationship with China."

Last month, South Korea's exports rose 4.5 percent on-year. The increase, the first in 15 months, is thanks to an improving chip sector. But the story is quite different when the number of working days is taken into account. Last month had more working days than in February, 2019, with fewer holidays. This means that the average daily exports actually declined. The nation's shipments to China have declined for two consecutive months amid the COVID-19 epidemic. A bigger problem is that the worst is yet to come. Greater economic fallout could be felt in March, when a large number of new export contracts are usually signed. Trade Minister Sung Yoon-mo predicts COVID-19 will cause greater economic repercussions than the 2003 SARS outbreak, which slashed South Korea's economic growth by a quarter percentage point.

[Soundbite] PROF. SUNG TAE-YOON(YONSEI UNIVERSITY) : "A prolonged COVID-19 spread could hurt South Korea's economic exchanges with other countries as well as China. Coupled with sluggish domestic consumption, decreasing trade will pose additional problems for the nation."

The government is pushing for a supplementary budget worth over 6.2 trillion won. The trade ministry plans to make sure the extra budget includes assistance for exporters hit by the outbreak.