News Room - Business/Economics

Posted on 29 Jul 2009

SKorea posts record surplus of almost US$22b in H1 2009

South Korea posted a record current account surplus of just under 22 billion dollars in the year's first half, data showed on Wednesday.

 

The country's broadest measure of trade and income was in the black in June for a fifth month running, the central Bank of Korea said, pointing to brisk exports and a sharp fall in imports.

 

The current account surplus in June was 5.43 billion dollars – its biggest since a record high of 6.65 billion dollars in March, the bank said in a report.

 

The cumulative current account surplus for the first half to June was a record 21.75 billion dollars, the bank said.

 

The current account, which measures trade, service and investment flows with the rest of the world, has been in the black since February.

 

"Exports of steel products and electronic goods have sharply increased, helping the trade surplus rise in June," the bank said in a statement.

 

The trade surplus in June was 6.61 billion dollars, up from a revised 4.88 billion dollars in May, the bank said.

 

The service account deficit narrowed to 1.45 billion dollars last month, compared with 1.47 billion dollars a month earlier.

 

The income account surplus was 678 million dollars last month, up from a 358.3 million dollar surplus a month earlier.

 

The capital account, which tracks cross-border investments, posted a net outflow of 404 million dollars last month, compared with a net inflow of 7.02 billion dollars a month earlier.

 

Lee Young-Bog, head of the central bank's division handling balance-of-payments statistics, said the country would likely post another surplus in July.

 

"Seasonal factors like summer vacations could prompt the service account deficit to increase," he told reporters.

 

"But given expected brisk exports, the country is likely to post a current account surplus of around four billion dollars for July," Lee said.

 

In a revised forecast earlier this month, the bank said it expects the current account surplus to reach around 29 billion dollars in 2009, up from its previous estimate of 18 billion dollars.

 

South Korea last year posted its first annual current account deficit in 11 years of 6.41 billion, owing to rising oil prices.

 

The country's economy grew 2.3 percent in the second quarter to June on surging exports and fiscal spending, following flat growth of 0.1 percent in the first quarter, according to the central bank.

 

It was South Korea's fastest growth in gross domestic product since a 2.6 percent increase in the fourth quarter of 2003.