Increased Game Exports Cut Chronic Trade Deficits
South Korea’s chronic intellectual property trade deficit totaled US$600 million in the first half of this year, the lowest since 2010 when the data began to be collected, the Bank of Korea said on Aug. 21. The drop was due to a sharp increase in game exports.
Korea has suffered deficits in intellectual property trade for a long time as large South Korean manufacturers of electrical and electronics products had to pay patent royalties to the United States.
In the first half of this year, the patent fee payments showed little change, yet the deficit decreased as local game companies increased their exports of franchise rights, computer program copyrights, and audio and video copyrights.
In the fields of publishing, video, broadcasting, communications and information service, the trade surplus hit a record high of US$850 million in the first half. Large corporations’ trade surplus in this field added up to US$480 million in the first half, too. This is because the top two game companies in South Korea, Netmarble Games and Nexon, have been classified into the group of large companies.
Likewise, the intellectual property trade surplus with China hit an all-time high of US$1.61 billion, led by game exports.
Meanwhile, South Korea’s trade deficit related to patents and utility models increased from US$340 million to US$1.02 billion between the first halves of 2017 and 2018.