Trade Jolt Expected
Chips, Autos to Lead February Rebound
By Kim Hyun-cheol
Staff reporter
Turning around from a deficit in the first month of the year, South Korea is expected to post a trade surplus this month on the back of positive economic prospects across the world, the nation's trade agency forecast Friday.
With the help of ship exports, overall trade could swing to a surplus of more than $1 billion, the Korea International Trade Association (KITA) said.
As the country's bellwether exports of semiconductors, autos and other goods remain strong, signals are surfacing that major trade destinations such as the United States, Japan and China are seeing their economies rebound, it said. Major industries here recorded 76.7 percent in export growth in January.
More promising is that international oil prices are staying stable, KITA added, as per barrel oil prices have increased to a bit above $70 since late last year.
Even though the nation posted the first trade deficit in 12 months, the organization downplayed the negative outcome in that it appears to be a momentary deviance.
South Korea posted a trade deficit of $470 million in January, the first time since it posted a deficit of $3.8 billion in January 2009, mainly due to a surge in energy imports amid a prevalent cold snap throughout the month. The figure is a turnaround from the $3.1-billion surplus in the previous month.
Still, it remains to be seen how the current factors of uncertainty will affect the global economy, said the Institute for International Trade (IIT), a KITA affiliate.
Growing pressure on financial restriction in Washington and intensifying tight-money policies in China could lead to an additional contraction of the economy along with the ongoing peril in several southern European countries, the institute said.
Snowballing deficits in the PIGS, an acronym referring to the four countries of Portugal, Italy, Greece and Spain, are likely to lead to a passing turbulence in the finance sector, but they will have a limited influence on Korea's exports, according to the IIT.
It also added that the exit strategy from Beijing will not damage Korea too much, considering the mutual industrial dependence between the two countries.