(Bloomberg) -- South Korea’s exports continued to grow last month on the back of strong demand for semiconductors and other technology devices, supporting confidence among policymakers that the economy will see a solid first quarter.

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Average daily shipments increased 9.9% from a year earlier, according to data released Monday by the trade ministry. Without adjustment for the number of working days, headline exports rose 3.1% while overall imports decreased by 12.3%. The trade surplus came to $4.3 billion.

South Korea is among the world’s largest exporters of goods, making it a bellwether for global commerce. Its dominance in memory chips and smartphones also makes the nation a barometer for tech demand. The latest figures point to continued recovery in global demand especially in the semiconductor sector.

South Korean exports of chips increased 35.7% from a year earlier in March to $11.7 billion, the largest monthly sales total since March 2022, the ministry said. Display exports rose 16.2% and computer sales increased 24.5%, too, underscoring the momentum that stems from technology demand.

“This year’s exports will be driven by technology,” said Lee JaeYoon, a researcher at the Korea Institute for Industrial Economics & Trade. Artificial intelligence and high-performance memory chips are among reasons semiconductor shipments are rising at a fast pace, raising hopes that they may grow enough this year to make up for losses last year, he said.

The growth momentum in exports fueled by the brisk semiconductor sales that has carried into this year is one reason authorities expect the South Korean economy to expand faster in 2024 than last year.

For the first quarter, overall exports amounted to $163.7 billion, an 8.3% rise from a year earlier, generating a trade surplus of $9 billion, according to the trade ministry.

What Bloomberg Economics Says...

“Our forecast is for the economy to expand 0.5% quarter on quarter in 1Q24, building on 0.6% growth in 4Q23. The trade data suggest there’s a chance growth will top our estimate.”

— Hyosung Kwon, economist

To read the full report, click here

Still, the chip recovery will need to be accompanied by a stronger pickup in exports of other products such as automobiles, steel and oil chemicals for authorities to be more certain that the economy will grow more than 2% as they estimate.