Trade surplus hits a record monthly high of $4.6 billion

Trade surplus hits a record monthly high of $4.6 billion
The Korean trade surplus for March was $4.6 billion - a record high, the Ministry of Knowledge Economy said yesterday.

The news comes a day after the central bank announced that the country saw a $3.6 billion surplus from its February current account balance, signaling the possibility of an economic recovery.

The government had earlier predicted that the economy would hit bottom in the first half and steadily head upward.

The previous monthly record - $3.8 billion - came in April 1998. The trade balance also saw a $3.9 billion surplus between January and March. While exports last month retreated 21.2 percent from a year ago to $28.3 billion, imports plunged 36 percent from the same month in 2008 to $23.7 billion. It was the largest decline since October 1998 when imports fell 39.3 percent year-on-year.

The government said although exports saw negative growth last month, the decline has been slowly easing since it hit a record drop of 34.2 percent in January.

“The recent balance of trade account is showing similar patterns to 1998 when the year’s trade surplus was $39 billion,” said Kang Myung-soo at the Knowledge Economy Ministry’s export-import department. “It seems exports hit bottom in January.” He hinted that exports would strengthen in the future.

The Knowledge Economy Ministry forecast exports will continue to see a year-on-year decline of around 20 percent until the third quarter, then ease to around a negative 5 percent growth in the fourth quarter. With the improvement in exports, the government estimated the overall trade surplus for 2009 will reach around $20 billion, which is far larger than the earlier prediction of a $12 billion surplus.

The March trade surplus was aided by major exports of ships as well as the depreciation of the won against the U.S. dollar. Sales of ships to overseas markets grew 61 percent year-on-year to $4.1 billion.

The local currency on average was trading at 1,453.4 won against the U.S. dollar. Meanwhile exports of other major products, including automobiles, mobile communications equipment and electronic consumer goods, all saw a double-digit drop.

China was the biggest importer of Korean products, accounting for 23.1 percent of all products exported from Korea. The European Union came in second at 14 percent. The U.S. was third, at 9.9 percent, followed by Asean countries at 9.8 percent.

By Lee Ho-jeong [ojlee82@joognang.co.kr]