S. Korea's current account surplus reaches $7.38 b in June

By Yonhap
  • Published : Aug 3, 2018 - 11:21
  • Updated : Aug 3, 2018 - 11:21

Korea's current account surplus continued its upside mode in June on an improved goods account surplus and reduced travel deficit, central bank data showed Friday.

The country's current account surplus came to $7.38 billion in June, up from $6.94 billion in the black a year ago, according to the preliminary data from the Bank of Korea. From a month earlier, the June figure declined from an eight-month high of $8.68 billion.

Asia's fourth-largest country has maintained a current account surplus for 76 straight months since March 2012.

The goods account surplus rose to $10.04 billion in June from $9.42 a year earlier as rising global demand for semiconductors buoyed Korea's overseas sales.


The service account remained in the red, logging $2.45 billion in deficit for June, narrowing slightly from $2.69 billion a year ago.

In particular, the deficit in the travel account contracted on-year to $1.2 billion last month from $1.39 billion thanks to a growing number of arrivals from China and Japan.

Some 380,000 Chinese tourists came to Korea last month, up 49 percent from a year ago, while the number of Japanese visitors soared 40.2 percent on-year to 235,000 in June.

"The monthly number of Chinese visitors has been growing since November last year when the Beijing government lifted a travel ban, but it still remained sluggish compared to some 700,000-900,000 arrivals per month in 2016," said an official from the BOK. "We expect the figures to reach around 400,000 from July in the summer vacation season."

The primary income account surplus improved to $460 million in June from $230 million in the previous month on increased dividend payouts.

For the first six months of the year, the country's current account surplus fell to a six-year low of $29.65 billion from $35.65 billion a year earlier and from $42.81 billion from six months earlier.

"The decline in the first-half current account surplus was largely driven by a sharp rise in crude oil prices," said the BOK official as Korea has to import almost all of its oil from abroad. "For the whole of 2018, the current balance as a percentage of GDP is forecast to be at 4 percent if the current high oil price trend continues."

Korea's ratio of the current account to GDP stood at about 5 percent in 2017.

The goods account surplus hit $55.69 billion in the January-June period as exports advanced to $307.28 billion to mark the second-largest first-half record on a boom in the global chip market.

The service account came to $15.94 billion in the red, widening from $15.41 billion a year ago.

The travel account deficit reached $8.5 billion, marking the second-largest half-yearly loss following $9.44 billion tallied in the second half of 2017, while a deficit in the transportation account broadened to a record $3.1 billion.

The imbalance comes as a number of Korean departures outpaced the number of foreign arrivals in the aftermath of a diplomatic row over the deployment of a US missile system between Seoul and Beijing that started in March last year. (Yonhap)