Korea posts current account deficit in November amid dwindling exports

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Korea posts current account deficit in November amid dwindling exports

Published: 10 Jan. 2023, 09:55 Updated: 10 Jan. 2023, 10:51

Containers are stacked at a pier in the port city of Busan on Oct. 11, 2022. [YONHAP]

Korea posted the first current account deficit in three months in November as exports sharply dwindled amid growing worries over a global economic recession, central bank data showed Tuesday.

The country's current account shortfall amounted to $620 million in November, swinging back from a surplus of $880 million a month earlier, according to the preliminary data from the Bank of Korea (BOK).

It marked the first deficit in three months and also represented a setback compared with the same month a year earlier when the country logged a surplus of $6.82 billion.

During the January-November period, the country's cumulative current account surplus stood at $24.37 billion, sharply down from a surplus of $82.24 billion tallied in the same period a year before, the data showed.

The deficit came as exports dwindled amid growing worries over a recession prompted by aggressive monetary tightening in major countries and stringent coronavirus curbs in China, one of the country's largest markets.

Korea exported $52.32 billion worth of goods and services in November, down 12.3 percent from a year earlier. Semiconductor sales, among other things, fell 28.6 percent on year in November, customs-cleared data showed.

By destination, exports shipped to China plunged 25.5 percent on year in November as Beijing's strict antivirus curbs hampered access to the world's most populous market.

Imports, meanwhile, inched up 0.6 percent on year to $53.88 billion in the month. This caused the goods balance to post a deficit of $1.57 billion in November, the second straight shortfall in the area. It also swung back from a surplus of $6.07 billion a year earlier.

Falling freight rates and increasing outbound travel bolstered by eased virus curbs also led to an increase in the service account deficit in November.

The service account, which includes outlays by Koreans on overseas trips and transport earnings, posted a shortfall of $340 million in November, compared with a surplus of $50 million in October. It was also larger than the previous year's shortfall of $270 million in the sector.

The primary income account, which tracks wages of foreign workers and dividend payments overseas, logged a surplus of $1.43 billion in November, down from the previous month's surplus of $2.26 billion.

The amount, however, increased from a year earlier when it stood at $1.17 billion on less dividend payouts, according to the data.

Yonhap