Report suggests diversifying exports beyond semiconductors to boost annual total to $1 trillion

South Korea's export structure, which is dependent on semiconductors, needs to move beyond this reliance and foster the global competitiveness of Korean consumer goods industries such as K-beauty and K-food to achieve an annual export value of $1 trillion, according to a suggestion.

The Hyundai Research Institute stated in its 'Export $1 Trillion, It Depends on K' report on the 24th that "the export portfolio must be diversified by adding high value to promising new industries and consumer goods items."

According to the report, annual exports in 2025 are projected to reach $709.3 billion, surpassing $700 billion for the first time in history, but this is attributed to the favorable performance of specific items like semiconductors.

In fact, semiconductor exports in 2025 increased by 22.2% compared to the previous year, while the export growth rate for non-semiconductor items was only 1.1%.

The institute classified items such as semiconductors, ships, and pharmaceuticals as 'golden opportunities' where market demand and competitiveness are simultaneously improving, based on an analysis of the market share of the top 20 export items from 2022 to 2024.

Items that expanded exports through product competitiveness and differentiation strategies, despite sluggish global demand, were designated as 'struggling but competitive.' Cosmetics and agricultural/fishery products are included in this category.

The report indicates that the competitiveness contribution of cosmetics and agricultural/fishery products increased by 22.2 percentage points (p) and 14.0%p, respectively, between 2023 and 2024. This is explained by the K-beauty craze directly leading to actual cosmetic purchases, and the increased recognition of Korean food culture due to the spread of K-pop and K-dramas leading to strengthened export competitiveness of agricultural and fishery products.

Items like secondary batteries and fashion apparel were classified as 'facing a crisis' due to decreased exports resulting from weakened competitiveness despite increased demand, while petroleum products and displays were categorized as 'adding insult to injury' due to simultaneous decreases in demand and competitiveness.

The institute emphasized the need to lay the foundation for sustainable qualitative growth to achieve an annual export value of $1 trillion, stressing the importance of focusing on 'struggling but competitive' items with high growth potential.

It further suggested, "It is necessary to vitalize export-tailored financial support and on-site regulatory response consulting so that cosmetics and agricultural/fishery products can settle as the second major export industries." The institute also recommended, "Beyond simple volume expansion, a high-value export structure should be built through premium brand strategies and technological advancement."