The Brief Surplus from the Oil Shock Has Ended... Trade Deficit Emergency

March Exports Reach $63.48 Billion... Record High
Imports Also Hit All-Time High... Trade Deficit at $140 Million
Impact of Soaring International Oil Prices... Energy Imports Double in One Year

[Asia Economy Sejong=Reporter Lee Jun-hyung] Last month, export value reached a record high of $63.48 billion. However, with energy import costs such as oil soaring to an all-time high, the trade balance returned to a deficit after just one month. Amid the prolonged Ukraine crisis and the continued surge in raw material prices including oil, there is also a possibility of an extension of the lockdown period in Shanghai, China due to the resurgence of COVID-19, raising concerns for the Korean economy, which heavily relies on exports.

According to the "March Export-Import Trends" announced by the Ministry of Trade, Industry and Energy on the 1st, last month’s exports increased by 18.2% compared to the same period last year, reaching $63.48 billion. This is the highest ever since the government began compiling trade statistics in 1956. The previous record was $60.7 billion recorded in December last year. The average daily export value also set a new record at $2.76 billion.

Last month’s imports also hit a record high of $63.62 billion. As a result, the trade balance recorded a deficit of $140 million. The trade balance had posted deficits for two consecutive months in December last year and January this year, then turned to a surplus in February, but returned to a deficit after just one month. Thus, the trade balance has shown a deficit of $4.04 billion from the beginning of this year through March.

The 27.9% surge in import value compared to the same period last year was largely due to the sharp rise in international oil prices and raw material costs caused by the Ukraine crisis. In fact, energy import costs are soaring. Last month, energy imports amounted to $16.19 billion, more than double the $7.72 billion recorded in the same period last year. Compared to February this year, it increased by $3.71 billion in just one month.

Despite these adverse factors, major export items continued to perform well. Specifically, semiconductor and petrochemical exports reached record highs of $13.12 billion and $5.42 billion, respectively. Information and communication technology (IT) items such as wireless communication (44.5%) and displays (48.4%), as well as traditional key industries like petroleum products (90.1%) and steel (26.8%), showed double-digit growth compared to last year.