Continuing Trade Surplus
Korea recorded a current account surplus of US$7.62 billion last month, increasing the amount of the surplus by US$420 million from the preceding year. The cumulative surplus for the first nine months of this year reached US$61.86 billion to show a 12.4 percent year-on-year growth.
The Bank of Korea is estimating the total current account surplus for this year at US$84 billion. Last year, the amount was a record-high US$79.9 billion. “These days, exports through customs clearance is picking up, despite the slowdown in processing trade and transit trade,” the central bank explained. The GDP-based total exports for the third quarter reflecting the overseas production factors decreased by 2.6 percent from a quarter earlier. The decrement is the largest since the fourth quarter of 2008. The international balance of payments, unlike the GDP, is based on the U.S. dollar and does not reflect GDP deflators.
The September current account surplus increased slightly from that of the previous month, as the goods account surplus went up from US$7.37 billion to US$7.73 billion. Specifically, the exports gained 4.2 percent month-on-month to US$50.98 billion, while the imports increased by 4.1 percent during the same period to US$43.25 billion.
At the same time, the services account deficit dropped from US$730 million to US$280 million between August and September owing to the improved travel and construction account balances. The tourism revenue totaled record-high US$1.77 billion last month.
In the meantime, the net capital outflow with no goods and service trade expanded from US$7.8 billion to US$8.76 billion during the period. That from direct overseas investment increased from US$750 million to US$2.15 billion, and net stock investment dropped from US$500 million to negative US$3.52 billion due to a selling spree by foreign investors. Other investments recorded a net outflow of US$1.88 billion, much decreased from US$7.29 billion of August, after the recovery of overseas deposits and loans.