Korea's current account turns to black in December, sharply smaller than prior year

Container boxes are stacked at a port in Busan, a port city in southern Korea, on Feb. 1. [JOONGANG ILBO]

Korea's current account swung back to the black in December from the previous month, but the amount was much smaller than a year before as exports dwindled amid growing global recession woes, central bank data showed Wednesday.

The country's current account surplus came to $2.68 billion in December, compared with a shortfall of $220 million a month earlier, according to the preliminary data by the Bank of Korea (BOK). The current account is the broadest measure of cross-border trade.

The December figure still represented a marked decline from a surplus of $6.37 billion tallied in the same month a year earlier.

For the whole of 2022, the surplus reached $29.83 billion, which was sharply smaller than an annual surplus of $85.23 billion a year earlier. The amount beat the BOK's surplus forecast of $25 billion.

The on-year decline in the surplus stemmed from weak exports and a deteriorating services account balance caused by falling revenue from the transport sector and rising overseas travel costs amid eased coronavirus curbs.

Exports in December fell 10.4 percent from a year earlier, though annual overseas shipments grew 6.3 percent from a year earlier.

The decline appears to have been affected by restricted access of Korean products to China, one of their largest markets, due to Beijing's strict coronavirus curbs and major countries' aggressive monetary tightening that raised worries over a global recession.

On a customs-cleared basis, exports of semiconductors tumbled 27.8 percent on year in December. Those of steel and oil products fell 20.5 percent and 17.2 percent.

By country, exports to China and Southeast Asian markets shrank 27.1 percent and 23.7 percent on year in December.

Imports declined 2.7 percent on year in December, with their annual figure jumping 17.7 percent from 2021 amid high energy prices, the data showed.

The goods balance, measuring inbound and outbound shipments, logged a shortfall of $480 million in December, compared with a surplus of $4.43 billion a year before.

In 2022, the goods balance surplus came to $15.06 billion, sharply smaller than the previous year's surplus of $75.73 billion.

The service account, which includes outlays by Koreans on overseas trips, posted a deficit of $1.39 billion in December, compared with a deficit of $760 million a year earlier. For 2022, the deficit also widened to $5.55 billion from the 2021 deficit of $5.29 billion.

The primary income account, which tracks wages of foreign workers and dividend payments overseas, saw its surplus grow to $4.79 billion in December from the previous year's $3.49 billion.

For all of 2022, the surplus came to $22.88 billion, compared with a surplus of $19.44 billion in 2021. The rise is attributed in part to expanded income from investments, including dividend payments.

Yonhap