Korea poised to hit $50B trade deficit, more than doubling record

Posted on : 2022-12-14 15:54 KST Modified on : 2022-12-14 15:54 KST
The previous record was US$20.62 billion, attainted in 1996
Containers fill a port in Busan in this undated file photo. (Yonhap)
Containers fill a port in Busan in this undated file photo. (Yonhap)

With Korea certain to post its first trade deficit in 14 years this year, the annual trade deficit may surpass its record high and hit US$50 billion for the first time ever.

According to trade balance data from the Korea Customs Service on Tuesday, this year’s trade deficit was US$47.46 billion as of Saturday.

This was 2.3 times Korea’s record trade deficit so far: US$20.62 billion, recorded in 1996.

This figure has either surpassed or is approaching annual deficit forecasts by major agencies and think tanks.

The Korea International Trade Association (KITA) had predicted an annual deficit of 42.6 billion, while the Korea Economic Research Institute predicted a deficit of 48.0 billion.

Given that the trade deficit as of last month was 42.541 billion, if Korea accumulates more than 7.5 billion in deficits this month, its total annual trade deficit will hit 50 billion.

October’s deficit was 6.724 billion, while November's was 6.991 billion.

This year’s trade deficit is due to a rising import total and slowing exports.

Import figures have increased with the rise in raw material prices, while the global economic slowdown, trouble in the semiconductor market and six straight months of falling exports to China — Korea’s largest trading partner — have taken a huge toll on exports.

Korea’s trade deficit is expected to continue next year as well.

KITA is predicting a deficit of 13.8 billion, while the Korea Institute for Industrial Economics and Trade is predicting a deficit of 26.6 billion.

By Choi Ha-yan, staff reporter

Please direct questions or comments to [english@hani.co.kr]

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