had 253,058 trading firms last year - a record setting figure led by
record-setting total value of trade.
number of trading firms saw a net increase of 10,030 last year compared to the
The number of newly established trading firms increased by 4.4%
to reach approx. 67,000 whilst the number of existing trading firms that exited
from their trade business decreased by 1.8% with approx. 57,000 leaving the sector.
Province contributed the most to the country’s exports and semiconductors and
electric products were top export items.
Korea Customs Service released “2021 statistics on trading activities by
companies” on July 27. The statistics revealed that the total number of trading
firms touched a fresh all-time high to reach 253,058 in 2021, which is a 4.1%
increase compared to the previous year, or equivalent to an addition of 10,030
new trading companies. Last year has seen the largest total value of trade,
which contributed to the record-setting number of trading firms.
performing trading activities are defined as those either engaged in exports or
imports. The total number of companies performing trading activities is smaller
than the number of exporting companies and importing companies combined as a
company that is both engaged in exports and imports is counted as a single
trading company. The Korea Customs Service conducts an annual survey on
exporting firms and importing firms to have a better understanding on the level
of maturity of trading firms by grading them as one out of the following three
categories ？ initial operation, entry or exit. Compiled figures and findings
are later published as official statistics.
year’s total value of trade hit a record at USD 1 trillion 226.8 billion, which
is an 28.1% increase (equivalent to USD 269.2 billion) compared to the previous
year. It is assumed that post-Covid economic recovery contributed to robust
trading activities, which led to an increase in firms engaged in trading
number of exporting firms shrank by 2.5% (equivalent to 2,500 firms) to 95,640
whereas the number of importing firms increased by 5.3% (equivalent to 10,594
firms) to 212,302. Newly established trading firms that entered the trading
business increased by 4.4% (equivalent to 2,844 firms) to 67,236. Companies
that exited from their trading business decreased by 1.8% (equivalent to 1,023
firms) to 57,206.
ratio and exit ratio figures were also released. Entry ratio is calculated by
dividing the number of newly established trading firms by the total number of
this year’s active trading firms and exit ratio is calculated by dividing the
number of trading firms that exited from their trading business by the total
number of active trading firms of the previous year. It turned out that entry
ratio slightly rose by 0.1%p to 26.6% and exit ratio decreased by 1.0%p to
23.5%. Entry ratio and exit ratio figures were also analyzed by item ？ specifically
ten most popular items that are handled by a bulk of exporting firms and
importing firms. Miscellaneous textile was named as an export item ？ a core
material used to produce Covid masks ？ that both posted the highest entry ratio
and exit ratio for two years in a row at 48.7% and 64.4% respectively.
is attributable to multiple companies entering and exiting the mask producing
business ？ a business with a low entry barrier ？ as the demand for masks
skyrocketed during the Covid pandemic. The entry ratio of leather products was
the highest among all imported items at 49.5% whereas miscellaneous textile
posted the highest exit ratio among all imported items at 53.8%.
survival rate is an indicator that shows how many firms maintain their trading
activities among all firms that established their trading business in 2020. The
rate for exporting firms slightly dropped to 46.7% - a 1.2%p decrease compared
to last year’s figure. The rate for importing firms saw a slight increase to
reach 50.9% - a 0.8%p increase compared to last year’s figure. Five-year
survival rates of trading firms that established their business in 2016 were
also released. It was revealed that 16.3% of exporting firms and 18.9% of
importing firms managed to maintain their business for at least five years.
version of one-year survival rate and five-year survival rate of trading firms
was released, which factors in the type of products these firms handle.
Exporting firms that handle minerals posted the highest one-year survival rate
at 53.7% and those handling medical products posted the highest five-year
survival rate at 16.9%. Importing firms that specialize in purchasing meat both
posted the highest one-year survival rate and the five-year survival rate at
65.3% and 27.1% respectively. Statistics also revealed that the number of Emerging
Exporting Companies totalled 4,111 last year ？ exporting firms that post higher
export growth rates compared to the average export growth rate of all firms
over the last three years ？ which is down by 21.7% compared to last year’s
number of Gazelles Companies saw a 14.9% decline with 1,315 Gazelles Companies
currently in the market. Gazelles Companies refer to newly established
companies among Emerging Exporting Companies that have been engaged in the
trading business for less than five years. Statistics on how much each region
contributes to exports was also released. It turned out that Gyeonggi Province
contributes 21.4% to Korea’s exports followed by South Chungcheong Province with
16.2%, Ulsan Metropolitan City with 11.5%, Seoul Metropolitan City with 10.6%
and Incheon Metropolitan City with 7.1%. The share taken up by the capital
region, including Gyeonggi Province, Seoul and Incheon Metropolitan cities, was
key items that contribute to Korea’s exports are electronic products, including
semiconductors, which take up 31.2% of the country’s exports followed by
machinery and computers with 11.8% and automobiles with 10.4%. Once the share
of these three items is combined, it reaches 53.4%, which means more than a
half of products that are exported are top three popular export items. Lastly,
the statistics revealed that Leading Companies ？ trading firms with annual
export size exceeding USD 10 million in value ？ contributed to 91.5% of Korea’s