Cumulative Trade Deficit Surpasses $10 Billion This Year... Concerns Over Three Consecutive Months of Deficit

Customs Service Export-Import Status from May 1 to 20
Exports Up 24.1%, Imports Up 37.8%
Annual Cumulative Deficit of 10.96 Billion USD

[Asia Economy Sejong=Reporter Dongwoo Lee] From January 1 to May 20 of this year, the trade deficit surpassed the $10 billion mark. This is due to a significant increase in imports of crude oil and gas caused by the surge in energy and raw material prices amid the prolonged Russia-Ukraine war. If the trade balance does not improve by the end of this month, there is a high possibility of recording a trade deficit for three consecutive months for the first time in 14 years.

According to the 'Export-Import Status from May 1 to 20' announced by the Korea Customs Service on the 23rd, export value (provisional customs clearance basis) was $38.617 billion, up 24.1% compared to the same period last year. The average daily export value, considering the number of working days, was $2.57 billion, an increase of 7.6% from $2.39 billion during the same period last year. The number of working days during this period was 15, two days more than the previous year.

Major export items increased, including petroleum products (145.1%), passenger cars (17.5%), semiconductors (13.5%), and automobile parts (8.3%). On the other hand, exports of wireless communication devices (-21.3%) decreased. By major countries, exports increased to China (6.8%), the United States (27.6%), the European Union (EU, 25.0%), Vietnam (26.9%), and Taiwan (71.9%), while exports to Hong Kong (-31.7%) decreased.

Although exports increased, imports rose at a greater rate.

During the same period, imports were recorded at $43.4 billion, up 37.8% compared to the same period last year. Imports of crude oil (84.0%), semiconductors (32.3%), and gas (40.6%) increased. By country, imports from China (37.3%), the United States (21.5%), the EU (3.5%), and Saudi Arabia (105.9%) increased significantly, while imports from Hong Kong (-31.7%) decreased.

In particular, imports from China, the largest import country, surged by 37.3%, and imports from resource-exporting countries Saudi Arabia and Australia also skyrocketed by 105.9% and 94.2%, respectively. Although coal imports amounted to $1.971 billion, which is less than crude oil, gas, and semiconductors in terms of value, it showed the highest growth rate of 321.3% compared to the same period last year.

This increase in imports is analyzed to be due to ongoing external adverse factors such as Russia's invasion of Ukraine and the resurgence of COVID-19 in China, including the 'Shanghai lockdown.' As of the first quarter of this year, the price of liquefied natural gas (LNG) was 1,327,500 KRW per ton, a 142.4% increase compared to 547,600 KRW in the same period last year, and during the same period, the price of thermal coal also jumped 164.8%, from $98.4 to $260.6 per ton.

With imports increasing more than exports, the trade deficit reached $4.827 billion from May 1 to 20. The trade balance recorded deficits of $140 million and $2.5 billion in March and April, respectively. If the deficit continues until the end of this month, it will mark three consecutive months of trade deficits for the first time in 14 years since the 2008 financial crisis.

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