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(LEAD) Korea's current account surplus narrows in Dec.

All News 08:01 February 06, 2020

(ATTN: UPDATES with more details, additional information from 7th para)
By Byun Duk-kun

SEOUL, Feb. 6 (Yonhap) -- South Korea's current account surplus narrowed sharply in December as its exports fell at a faster rate than imports, central bank data showed Thursday.

The country's current account surplus came to US$4.33 billion in the month, down $1.64 billion from the month before, according to preliminary data from the Bank of Korea (BOK).

The reading also marks a $580 million drop from the same month in 2018. The country's current account balance has been in the black for eight consecutive months since May 2019.

The file photo, taken Dec. 1, 2019, shows stacks of export-import containers at South Korea's largest port in Busan, located some 450 kilometers south of Seoul. (Yonhap)

The drop was partly attributed to a steady decline in exports, which in December dipped 3.5 percent on-year, while imports only inched down 0.3 percent.

South Korea posted a goods account surplus of $5.03 billion in the month, compared with a surplus of $7.39 billion in November and a $6.63 billion surplus a year earlier.

Its service account deficit reached $2.5 billion, compared with a $1.89 billion deficit the month before and $1.85 billion a year earlier, according to the BOK.

Its primary income account surplus more than tripled to $2.67 billion from $880 million over the cited period on an increase in dividend income.

For the entire year, the country's current account surplus came to $59.97 billion, sharply down from $77.47 billion surplus posted in 2018.

South Korea's exports dropped each and every month in 2019 amid the prolonged trade dispute between the world's largest economies, the United States and China, that are also the largest importers of South Korean goods.

Its goods account surplus narrowed to $76.86 billion last year from $110.09 billion a year earlier as its exports plunged 10.3 percent on-year to $561.9 billion last year, while imports dipped 6 percent to $485.1 billion.

However, its service account deficit narrowed to $23 billion from $29.37 billion in 2018, possibly due to a drop in the number of South Koreans traveling to Japan.

South Koreans began boycotting Japanese products and tours to Japan in July when Tokyo removed Seoul from its list of trusted trade partners in an apparent move to retaliate for the ruling by South Korea's Supreme Court that ordered Japanese firms to pay compensation to their former forced labor Korean workers during Japan's 1910-45 colonial rule of Korea.

In 2019, South Korea's tourism account deficit narrowed to $10.7 billion from $16.57 billion in 2018.

Its primary income account surplus more than doubled to $12.2 billion from $4.9 billion over the cited period.


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