Due to Decline in Exports
South Korea’s current account surplus dropped approximately 70 percent from a year ago in January this year due to a decline in exports. The Bank of Korea announced on March 5 that the surplus hit a nine-month low of US$1,006 million in January. For reference, it was more than US$3.29 billion in January 2019 and US$4.33 billion in December 2019.
In January this year, South Korea’s goods account surplus plummeted while its service account deficit decreased to some extent. Specifically, the goods account surplus dropped from US$5.75 billion to US$1.93 billion in one year. “The number of business days was less due to the New Year’s holidays and the prices of major export items such as semiconductor, steel and chemical products continued to fall,” the central bank explained.
Last month, in the meantime, South Korea’s exports increased 4.5 percent from a year ago to US$41.26 billion and its imports edged up 1.4 percent to US$37.15 billion.
In January, the country’s service account deficit decreased by US$1.05 billion year on year to US$2.48 billion. That month, the number of those who entered South Korea showed a year-on-year increase of 15.2 percent, led by Chinese, whereas the number of those who left the country fell 13.7 percent. The travel account deficit decreased US$210 million year on year and reached US$1.33 billion. Likewise, the IP royalty deficit fell about US$200 million to US$290 million.
The primary income surplus edged up from US$1.68 billion to US$1.69 billion in one year while South Korea’s overseas direct investment and foreigners’ investment in South Korea rose US$2.49 billion and US$550 million, respectively. Securities investment from and in South Korea increased US$6.34 billion and US$5.92 billion, respectively.