S. Korea logs current account surplus for 2nd month; surplus shrinks amid mounting import costs

▲ Containers for export are stacked at a pier in South Korea's largest port city of Busan on Aug. 1, 2022. South Korea suffered a trade deficit of US$4.67 billion for the fourth consecutive month in July over high global energy prices, with exports and imports standing at US$60.7 billion and $65.37 billion, respectively, according to the ministry. (Yonhap)

current account-June

S. Korea logs current account surplus for 2nd month; surplus shrinks amid mounting import costs

SEOUL, Aug. 5 (Yonhap) -- South Korea posted a current account surplus for the second straight month in June, but its amount sharply contracted from a year earlier amid mounting import costs emanating from high energy and commodity prices, central bank data showed Friday.

The country's current account surplus stood at US$5.61 billion in June, accelerating from the previous month's surplus of $3.86 billion, according to the preliminary data from the Bank of Korea (BOK).

It marked the second straight month of a surplus following April when South Korea registered a deficit of $80 million -- the first shortfall since April 2020 -- due in part to such one-off factors as expanded overseas dividend payments.

In the January-June period, the country's cumulative current account surplus came to $24.78 billion, sharply down from $41.76 billion a year earlier, though it topped the BOK's first-half projection of $21 billion.

The June surplus was much smaller than the same month a year earlier when the country logged a surplus of $8.83 billion, the data showed.

The on-year decline stemmed mostly from rising import bills caused by high prices of energy and key commodities amid global supply snarls that have been exasperated by the ongoing war in Ukraine.

In particular, imports of crude oil and coal jumped 53.1 percent and 189 percent, respectively, in June from a year earlier. Imports of such capital goods as semiconductors and related equipment also rose 37 percent and 6.8 percent, respectively, over the cited period.

Exports, meanwhile, came to $59.53 billion, slightly smaller than the previous month's $61.7 billion. The outbound shipments, however, were larger than $54.59 billion tallied a year earlier.

The goods balance that tracks imports and exports registered a surplus of $3.59 billion in June, which more than halved from a surplus of $7.55 billion a year earlier.

The service account, which includes outlays by South Koreans on overseas trips and transport earnings, posted a deficit of $490 million.

This represented the second straight month of a shortfall amid increasing overseas travel after the country eased anti-pandemic curbs. The deficit was still smaller than a deficit of $1.02 billion the previous year thanks in part to expanded earnings from high freight rates.

The primary income account, which tracks wages of foreign workers and dividend payments overseas, logged a surplus of $2.77 billion in the month, up from a surplus of $2.56 billion, the data showed.

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