Intellectual Property Trade Deficit of $1.33 Billion... Cultural and Artistic Copyrights Record Largest Surplus Ever

Turned to Deficit Last Year Due to Global Economic Slowdown
Three Consecutive Years of Surplus in Cultural and Artistic Copyright Trade Balance Driven by K-Content Popularity

[Image source=Yonhap News]

Riding on the success of Squid Game and BTS (Bangtan Sonyeondan), the intellectual property trade balance, which recorded a historic surplus for the first time in 2021, turned to a deficit last year due to the base effect of a surge in exports and the global economic slowdown.

However, as Korean dramas and music such as The Glory and Juvenile Justice continue to make waves, the cultural and artistic copyright trade balance achieved a record high surplus last year. With K-content gaining worldwide popularity, the cultural and artistic copyright trade balance has recorded a surplus for three consecutive years.

According to the '2022 Intellectual Property Trade Balance (Provisional)' released by the Bank of Korea on the 24th, the intellectual property trade balance posted a deficit of $1.33 billion last year, turning to a deficit compared to the previous year. The deficit widened as industrial property recorded a deficit of $2.62 billion due to a decrease in exports of patents and utility models to local subsidiaries, and the surplus in copyrights also shrank due to reduced exports of research and development and software (SW) copyrights by IT companies.

By type, the trade balance for patents and utility models recorded a deficit of $1.87 billion, expanding the deficit. This was due to a decrease in exports of patents and utility models by domestic large corporations. The trade balance for trademarks and franchise rights recorded a deficit of $640 million, narrowing the deficit.

The cultural and artistic copyright trade balance posted a surplus of $600 million, marking the largest annual surplus on record. Cultural and artistic copyrights have been increasing their surplus for three consecutive years, recording $170 million in 2020, $410 million in 2021, and expanding further last year.

The music and video trade balance achieved a surplus of $530 million, reaching the highest annual surplus ever. This was due to increased exports of music and video copyrights by domestic video content producers and entertainment companies, as Hallyu content received favorable reviews.

Kim Hwayong, team leader of the International Balance of Payments Team at the Bank of Korea's Economic Statistics Bureau, explained, "Last year, as Korea's music, dramas, and webtoons performed well, the cultural and artistic copyright trade balance recorded a surplus for three consecutive years," adding, "K-content on Netflix platforms such as The Glory, Suriname, and Juvenile Justice has gained popularity, maintaining the surplus trend."

The research and development and SW copyright trade balance posted a surplus of $920 million, with the surplus narrowing compared to the previous year. Computer programs recorded a deficit of $1.84 billion, marking the largest annual deficit. Team leader Kim said, "The computer program trade balance showed a deficit of $1.12 billion in 2021 and again recorded the largest annual deficit last year," attributing this to a decrease in computer program exports by game companies.

By institution type, the trade balance of domestic large corporations was $3.59 billion, with the surplus narrowing compared to the previous year. This was due to a decrease in exports of patents, utility models, and database copyrights.

By industry, the electrical and electronic products manufacturing sector posted a surplus of $450 million, and the automobile and trailer sector recorded the largest surplus ever at $1.26 billion. The information and communication sector (-$400 million) saw an expanded deficit.

By trading partner country, the United States (-$1.9 billion) had the largest deficit, but the deficit significantly decreased due to increased exports of industrial property rights related to electrical and electronic products and automobiles, as well as music and video copyrights.

China ($1.03 billion) recorded the smallest annual surplus ever. This was influenced by China's restriction on youth gaming hours starting in September 2021, which greatly reduced computer program exports by game companies, and an increase in imports of patents and utility models by domestic large corporations.

Vietnam ($1.71 billion) saw a reduced surplus compared to the previous year due to decreased exports of patents and utility models to local subsidiaries.

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