South Korea's current account surplus halved in February from a year earlier due mainly to an increase in the deficit in the service account, central bank data showed Thursday.
The country's current account surplus reached $4.03 billion in February, down sharply from a surplus of $8.18 billion a year ago, according to the preliminary data from the Bank of Korea.
It marked the 72nd consecutive month of a current account surplus, which started in March 2012.
The services account deficit widened to $2.66 billion from a deficit of $2.21 billion a year earlier due mainly to a rise in overseas trips and foreign business services.
 |
Incheon International Airport (Yonhap) |
In particular, the deficit in the travel account reached $1.41 billion, up from a deficit of $1.17 billion a year earlier.
But it marked the lowest monthly figure in five months as more foreign visitors arrived and fewer Koreans went abroad during the PyeongChang Winter Olympics from Feb. 9-25.
In February, foreign arrivals fell 16.5 percent on-year to 1.05 million, led by a 41.5 percent plunge in Chinese visitors. But the decline was offset by a 25.3 percent jump and a 22.3 percent gain by US and European visitors, respectively, over the one-month period.
At the same time, Korean departures increased at a four-year low rate of 3.6 percent on-year to 2.3 million in February.
"We see that South Koreans' strong demand for overseas trip was partly reduced thanks to the Winter Olympics on home soil," said Roh Chung-seak, director of the Monetary and Financial Statistics Division of the BOK. "The Olympics contributed to the current account in a positive way."
The goods account surplus also contracted to $5.99 billion in February from $10.22 billion a year earlier as the Lunar New Year's holiday decreased business days in the month.
The primary income account, however, saw its surplus widen to $1.28 billion in February from a surplus of $720 million a year earlier.
Meanwhile, Asia's fourth-largest economy's exports edged up 4 percent on-year to $44.9 billion in February, slowing down from a 22.3 percent jump in the previous month. Imports rose 14.8 percent on-year to $41.6 billion.
The BOK official also said South Korea's current account balance, or the ratio of current account to gross domestic product, will likely go down to 4 percent by the end of this year, declining from 5.1 percent in 2017 and 7 percent in 2016.
"It has been declining," he said. "The ratio will be slightly over the 4 percent level in 2018."
Washington has put South Korea on its monitoring list of currency manipulators, citing a large bilateral trade surplus with the US, a global current account surplus of at least 3 percent of GDP and foreign exchange interventions. (Yonhap)
