Exports from the 1st to 10th of this month total $15.7 billion... a 12.6% decrease compared to last year

Import Value Down 6.6% YoY Due to Fewer Operating Days
Trade Deficit at $3.5 Billion... Three Consecutive Months Since December Last Year
Main Factor Is Soaring Energy Prices... "Stability Expected Only in Second Half"

[Image source=Yonhap News]

[Asia Economy Sejong=Reporters Dongwoo Lee and Junhyung Lee] Due to the reduced number of working days during the Lunar New Year holiday, exports decreased by 12.6% over the first ten days of February compared to the same period last year. The trade balance, calculated as exports minus imports during this period, recorded a deficit of 3.5 billion dollars. If the overall trade balance for this month also shows a deficit, it will mark three consecutive months of deficits since December last year, the first time in 14 years since 2008.

The Korea Customs Service announced on the 11th that the export value (provisional customs clearance basis) from the 1st to the 10th was 15.7 billion dollars, down 12.6% from the same period last year. The main reason was the two fewer working days compared to last year due to the Lunar New Year holiday. Considering the number of working days (6.5 days), the average daily export value was 2.41 billion dollars, an increase of 14.2%. Monthly export values have increased year-on-year for 15 consecutive months from November 2020 through last month. However, the export growth rate last month (15.2%) has been slowing since October last year.

Imports during the same period also decreased by 6.6% compared to a year earlier, totaling 19.2 billion dollars. This was also largely influenced by the reduced number of working days.

As a result, the trade deficit during this period widened to 3.5 billion dollars, compared to a 2.6 billion dollar deficit a year ago. The trade balance turned to a deficit in December last year after 20 months. The deficit last month reached a record high of 4.89 billion dollars. The continuous surge in energy prices, including oil, was cited as a major cause. Although natural gas prices began to decline earlier this month, forecasts suggest the weakness will not last long.

By industry, exports increased in semiconductors (7.4%), petroleum products (27.1%), and computer peripherals (29.0%), while exports sharply decreased in passenger cars (-47.5%) and wireless communication devices (-44.2%). Major import items that increased included crude oil (11.8%), semiconductors (1.1%), petroleum products (8.6%), and passenger cars (25.8%).

Kim Taegie, Honorary Professor of Economics at Dankook University, said, "The biggest cause of the trade deficit is the surge in energy and raw material prices. With the US-China confrontation and the Russia-Ukraine situation overlapping, international political uncertainty has increased. I expect import prices to stabilize only in the second half of this year."

This content was produced with the assistance of AI translation services.