South Korea is expected to post a trade deficit for the third straight month in February due to the high prices of crude oil, grain and raw materials, officials said Friday.
A deficit for February would mark the first time in five years that the country's trade balance has gone into the red for three consecutive months and could affect trade targets set for this year, said officials at the Commerce Ministry.
Early this year, the ministry forecast that South Korea's trade will surpass the $800 billion mark for the first time with the surplus reaching $13.0 billion.
``Up till Wednesday. the country exported $17.9 billion worth of goods and imported $21.8 billion for a deficit of about $3.9 billion,'' a ministry official said. He said that while there may be a surge in exports in the remaining nine days of the month, the overall trend is unlikely to be altered.
``Skyrocketing crude oil, iron ore, grain and beans are the main culprits for the deficit,'' he said. Crude oil imports were up 78 percent on a yearly basis as of January, while grain and bean imports shot up by more than 80 percent.
The official, however, said solid gains in car exports this month could help reduce the size of the deficit that may not be as large as in January. He predicted that South Korea may post a monthly trade deficit at least until the first quarter.
In December and January, the monthly trade deficit reached $870 million and $3.3 billion respectively.
Private think tanks, meanwhile, said that if crude oil prices and other raw material prices don't stabilize and come down, the country could face an annual trade deficit for the first time since 1998.
``With the country relying on imports for most of its raw materials there is nothing that can be done about the current trade imbalance,'' a researcher at a think tank said. (Yonhap)