Spending in Overseas

The overseas spending in the first half of this year swelled 9.9% from the previous year while the spending in the second half of last year gained by 7.3% year on year.
The overseas spending in the first half of this year swelled 9.9% from the previous year while the spending in the second half of last year gained by 7.3% year on year.

 

It has been found that in the past one year, Koreans spent more than 30 trillion won (US$27 billion) in foreign countries.

According to Korean households’ final consumer spending statistics in the national accounts of the Bank of Korea on October 2, Koreans spent 30.286 trillion won (US$27.25 billion) from July of last year to June of this year.

Consumer spending refers to the amount of money that households pay for their living expenses, such as food, clothing, shelter and transportation. Overseas consumer spending does not include money spent on work such as cross-border online shopping or business trips.

Households’ overseas quarterly spending in the second half of last year exceeded 15 trillion won (US$13.5 billion) for the first time by amounting to 15.1905 trillion won. The spending also towered over 15 trillion won by hitting 15.962 trillion won in the first half of this year, too. In the second half of last year, the spending gained by 7.3% year on year. In the first half of this year, the spending swelled 9.9% from the previous year.

This tendency is attributed to an increase in the number of Koreans’ overseas trips. The number of Korean people enjoying overseas travel on holidays during vacation seasons is on the rise thanks to the expansion of low-cost air routes. According to the Korea Tourism Organization (KNTO), the number of foreign tourists in the first half of this year reached 12.627 million, up 18.7 percent from the first half of last year.

Korean households’ overseas spending is not small compared to their domestic spending. From the second half of last year to the first half of this year, overseas expenditure was 26.5% more than domestic telecommunication expenditure (23.943 trillion won or US$21.54 billion). It is 33.3% of domestic spending on transportation (90.873 trillion won or US$81.78 billion).

Given the economic growth and expansion of international exchanges of Korea, the increase in overseas consumption can be regarded as a natural phenomenon. However, in order to expand domestic demand, it is pointed out that it is necessary to turn Korean outbound travelers’ eyes to domestic tourist destinations. In particular, self-employed people in Korea are facing difficulties as the number of foreigners to visit Korea has been going downhill, for example, by China’s retaliation against Korea for the latter’s deployment of the THAAD System.

The government is also racking its brains to prepare countermeasures. On September 28, the government said that the government would encourage Koreans to travel to domestic destinations and revitalize Korean tourism by means of the Pyeongchang Winter Olympic Games in a meeting of the ministers of economic affairs.

 

 

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