First Trade Deficit in 99 Months
South Korea's trade balance recorded a deficit in April for the first time in 99 months due to sluggish exports amid the COVID-19 pandemic.
The Ministry of Trade, Industry and Energy announced on May 1 that exports totaled US$36.9 billion in April, a 24.3 percent plunge from a year ago.
Imports were tallied at US$37.8 billion, down 16 percent on year. As a result, Korea posted a deficit of US$950 million, ending a 98-month trade surplus streak.
The ministry attributed the poor export performance in April to a plunge in global demand amid the pandemic as well as fewer business days and a higher base effect.
When the number of work days is taken into consideration, daily average shipments fell 17.4 percent last month.
Exports fell in all major global regions due to the spread of COVID-19. Exports to China fell 17.9 percent while shipments to the United States and the European Union sank 13.5 percent and 12.8 percent, respectively.
Despite the sharp drop in exports, the bio-health sector enjoyed a 29 percent surge due to increased overseas demand for Korean quarantine products. Shipments of computers also soared 99 percent as working from home increased due to the pandemic.
The ministry said the trade deficit is a temporary phenomenon. Minister Sung Yun-mo assured exports will rise again once the pandemic is put under control.