South Korea's trade surplus with the European Union (EU) fell sharply after the free trade pact went into effect a year ago due to eurozone woes that hurt exports and caused a rise in imports, government data showed Wednesday.
According to data by the Korea Customs Service (KCS), imports from the EU shot up 13 percent on-year to US$49 billion between July 2011 and June this year. Exports fell to $50.9 billion from
$57.9 billion during the period, with the surplus dropping to just $1.9 billion from $14.5 billion reported before the FTA went into force.
The free trade agreement (FTA) between South Korea and the EU, which was formally signed in October 2010, took effect starting in July of last year.
Inbound goods were led by automobiles and machinery that rose 11.3 percent and 22.7 percent, respectively, with numbers for aircraft and related parts skyrocketing 122 percent on-year. There was also a 110 percent spike in petroleum product imports.
"The drop in exports and the trade surplus are directly related to persistent economic concerns surrounding some European countries that have effectively caused demand for goods to fall across the board," the KCS said.
With the exception of February, outbound shipments to the EU contracted from the year before, with ships and flat panel display exports falling 47.3 percent and 15 percent, respectively, compared to the year before, it said
The data, however, showed that exports of cars and automobile parts soared 38 percent and 15.8 percent from the year before thanks to lower import duties imposed by the EU, with refined petroleum product shipments surging 23.9 percent. (Yonhap News)
