South Korea's semiconductor exports could fall $50 billion to $100 billion below earlier forecasts if US tech giants slow AI capital spending next year, Bank of Korea modelling submitted to a lawmaker shows.
South Korea's semiconductor exports could fall by $50 billion to $100 billion compared with earlier forecasts if capital spending on artificial intelligence by major US technology firms slows next year, according to Bank of Korea data reported on Tuesday.
The central bank modelled the fall in a pessimistic scenario set out in a written response to lawmaker Ahn Do-geol. Under the scenario, a sudden export shortfall would shave about 0.4 percentage point off South Korea's GDP growth next year, pushing the current account surplus well below the bank's initial projection of $430 billion for 2027.
The scenario assumed a 10 percent decline in Korean semiconductor unit prices. It reflects growing anxiety over South Korea's heavy reliance on chips, which account for roughly half of the country's exports.
Combined capital expenditure by five major US technology firms — Amazon, Google, Microsoft, Meta and Oracle — has grown rapidly, from $40 billion last year to an estimated $80 billion this year, and is projected to reach $110 billion next year, the report said.
The Bank of Korea cautioned that considerable uncertainty remains over the trajectory of AI demand and the broader memory-chip business cycle, meaning the pessimistic outcome is a modelled scenario rather than a forecast.
The warning lands days after South Korea reported third-quarter GDP growth of 1.0 percent, helped by chip exports beating forecasts — a contrast that underlines how much of the recent expansion rests on continued AI hardware spending.
People Sentiments Public Mood: Neutral
- Bank of Korea cautioned considerable uncertainty remains over AI demand and the memory-chip cycle
- Report underscores anxiety over South Korea's reliance on chips at roughly half of exports