$20 Bil. Trade Surplus Expected This Year
By Kim Hyun-cheol
Staff Reporter
Korea is forecast to post a $20 billion trade surplus this year thanks to a huge drop in imports, higher than the $12 billion surplus predicted last December.
The Ministry of Knowledge Economy made the prediction after announcing that the country recorded a $3.3 billion trade surplus last month, the largest month in the black since July 2007. On a cumulative basis to February this year, the trade account is in equilibrium, it reported.
It forecast that exports will reach $422 billion, the same level as last year, but imports will fall by 30 percent, Kwon Hyun-chul, a ministry official, said.
Last month, all major industries posted negative growth in exports, except for shipbuilding, which grew 47.1 percent year-on-year.
Hwang In-seong, a research fellow at the Samsung Economic Research Institute (SERI), said oil prices will be the key factor determining this year's trade surplus. With oil prices falling over $10 per barrel this year, the surplus will be larger if the low oil price trend is maintained, he said.
But he was not positive on the economic outlook, saying demand for exports remains low despite the double-digit fall in commodity imports.
``It is still worrisome to see both exports and imports faltering,'' said Kim Young-sam, an economist at the Hana Institute of Finance. ``The current trend, in many ways, is similar to the Asian financial crisis in the late 1990s. Back in 1998, Korea had a nearly $40 billion trade surplus due to reductions in imports.''