Beating Japan
Korea’s current account surplus is expected to surpass that of Japan this year for the first time.
According to the Bank of Korea and Japanese financial ministry on November 3, Korea recorded a current account surplus of US$42.22 billion in the January-August period of this year. Japan, the world’s No. 3 economy after the United States and China, recorded a current account surplus of $41.53 billion during the same period.
In the first eight months of this year, Korea, Asia’s fourth-largest economy, topped Japan in terms of the current account surplus for the first time since 1980 when the tracking of related data began.
For the entire year, Korea is expected to record a current account surplus of US$63 billion, larger than Japan’s US$60.1 billion, according to reliable sources.
Last year, the economic dimensions of Japan were almost six times larger than that of Korea, which made it difficult even to compare the current accounts.
Analysts say Korea’s expected overtaking of Japan reflects the current economic conditions facing the two countries. Korea’s exports of key products such as mobile phones and cars have been strong, while Japan’s electronics giants fell down amid surging energy imports.
But no one knows how long this trend will continue. Lim Hee-jung, a researcher of Hyundai Economic Research Institute, predicted, “A continuous weak yen could give a negative impact on Korea’s exports and current account surplus,” saying, “Korea has been under the pressure of won appreciation due to the large scale of the current account surplus.”
In September alone, Korea posted a current account surplus of US$6.57 billion, marking the 20th straight month of surplus.