Korean Won's Share in Export Settlements Hits Record High Last Year

Last year, the proportion of payments received from trading goods with foreign countries that were settled in Korean Won reached an all-time high of 3.4%. This indicates a growing trend in the use of the Korean Won in international trade.

The share of payments settled in US dollars was the highest at 84.2%, but it decreased by 0.3 percentage points from the previous year. The proportion settled in Euros was 5.9%, Japanese Yen 1.9%, and Chinese Yuan 1.3%. The rise in the Won settlement share was primarily attributed to a 33.1% increase in exports of passenger cars and semiconductor manufacturing equipment. The decline in the US dollar settlement share resulted from a combination of factors, including reduced exports to the US due to American tariffs and the export growth rates of chemicals and petroleum products, which often involve dollar settlements, falling below the overall export growth rate of 3.8%. Exports settled in Yuan also saw their share diminish due to declining shipments of key items such as steel products.

For import payments last year, the share settled in Korean Won also reached a record high of 6.6%. This was driven by an increase in imports settled in Won, such as passenger cars from the European Union (EU) and the United States. The proportion of imports settled in US dollars remained the highest at 79.3%, though it dropped by 1.1 percentage points year-on-year. Import shares for Euros and Yen saw slight increases.

The Bank of Korea's Economic Statistics Department, International Payments Team, reported that both the decrease in the US dollar's share in export-import settlements and the rise in the Won's share marked record highs. This was analyzed as a reflection of reduced exports to the US and falling energy prices, along with a spillover effect from increased exports and imports of items with a higher Won settlement proportion, such as passenger cars.