FOR an export juggernaut, South Korea’s recent losing streak is alarming: for 14 straight months its exports have fallen in value terms compared with a year earlier. In January they plummeted by 18.8% to just under $37 billion—the steepest drop since 2009. Petrochemical products are a key South Korean export, so low global oil prices partly explain the numbers. Still, the country’s longtime engines of growth, including steel mills, shipyards and car plants, appear to be running out of puff.

Last year POSCO, a steel giant set up in 1968, posted its first annual net loss. It had already been bumped down the global rankings by Chinese and Japanese rivals, from third- to fifth-largest producer, between 2010 and 2014. This month Daewoo Shipbuilding & Marine Engineering (DSME), one of the world’s biggest shipbuilders, recorded its worst deficit on record, losing more than 5 trillion won ($4 billion) in 2015. Its sales fell by almost a quarter. It laid off 13,000 workers last year; now it says it will dismiss a further 12,000. In January Hyundai Motor, a carmaker, reported a drop in profits for an eighth straight quarter. It expects sales (combined with those of its affiliate, Kia Motors) to inch up by 1.5% this year—a fraction of the 24% growth achieved in 2010.

Such firms are being hurt by growing output among Chinese producers and by the won’s recent strength against the yen, which is helping Japanese rivals. South Korea’s exports are equivalent to around half of its GDP, and a quarter of them go to China, where growth has been faltering. Ryu Seung-sun, head of research at Mirae Asset Securities in Seoul, says that because South Korea exports parts for consumer goods, like screens and chips for Chinese smartphones, it is bound to be among the first to suffer from a worldwide slowdown.

However, Park Sangin, an economist at Seoul National University, thinks internal factors are the bigger culprits: after all, the country’s economy weathered the recent global recession with relative ease, he says. Many of its sprawling conglomerates are built around the smokestack industries that powered the country’s industrial take-off under Park Chung-hee, a former dictator (and father to the current president, Park Geun-hye) over four decades ago, with the result that manufacturing accounts for as much as a third of South Korea’s GDP today. Over the years these chaebol, as the conglomerates are known, have expanded into all sorts of sectors. One-tenth of their offshoots are now unprofitable “zombie” firms, kept on life support through cross-shareholdings.

Some industrial groups have begun to shed ailing, non-core businesses; DSME, for example, is selling a subsidiary that runs golf courses. However, others are continuing to diversify in pursuit of new sources of growth. As Samsung’s electronics affiliate has lost market share to plucky smartphone-makers in China, the group has moved, among other things, into biopharmaceuticals, the pet project of the conglomerate’s de facto boss, Lee Jae-yong. Samsung BioLogics recently broke ground on its third production plant which, when up and running, will make it the world’s largest manufacturer of such drugs.

Other businesses are thriving despite the downturn. Seven of the ten best-performing stocks last year in the MSCI Asia Pacific Index, a benchmark followed by big investment funds, were South Korean, among them pharmaceutical, cosmetics and aerospace firms.

Media stocks have been buoyed recently by the success of CJ E&M, a subsidiary of CJ Corp, another chaebol. The affiliate established itself as an export star with the hit 2013 film, “A Wedding Invitation” (pictured), made for the Chinese market with Chinese actors but a Korean crew. In November last year MSCI added CJ E&M to its Korea index, as it bumped out Daewoo Shipbuilding and Hyundai Merchant Marine, a struggling shipping line. As media firms profit from the popularity of Korean soap operas, films and music in China and South-East Asia, more are partnering with Chinese firms to produce or promote content.

It is doubtless a good thing that the South Korean economy no longer has all of its export eggs in a handful of heavy-industrial baskets. But cultural and fashion businesses are no less volatile and vulnerable to global trends than ones that make stuff out of lumps of metal. Last month South Korea’s two biggest cosmetics-makers, Kolmar Korea and Cosmax, which now depend heavily on the Chinese market, announced lacklustre earnings. Even a more diverse export base is not enough to protect South Korea entirely from the chill winds blowing across Asia.