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S.Korea exports grow at slowest in 11 months, trade deficit hits record

  • Jan exports +15.2% y/y, imports +35.5%
  • Trade deficit hit record $4.89 billion in January
  • Rising Energy Demand, Prices Main Reason for Record Trade Deficit – Trade min

SEOUL, Feb 1 (Reuters) – South Korea’s exports grew at the slowest rate in almost a year in January, while a sharp rise in energy demand and prices pushed the country’s trade deficit to a record high.

Exports rose 15.2% year on year to $55.32 billion in January, Commerce Department data showed on Tuesday, rising for the 15th straight month on solid demand for chips and petrochemicals.

However, the rate was down from an 18.3% rise in December and the slowest since February 2021. A Reuters poll of 10 economists had expected growth of 15.5%. Continue reading

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Growth in January was led by a 24.2% rise in semiconductor sales, South Korea’s largest export by value, while outbound shipments of petrochemicals, oil and steel products rose 40%, 88.4% and 50.1%, respectively.

By destination, exports to China, South Korea’s largest trading partner, rose 13.1%, and those to the United States and the European Union rose 1.6% and 13.3%, respectively.

Imports rose 35.5% to $60.21 billion in January, taking the trade deficit to a record $4.89 billion.

“Growth in imports, which is outpacing exports due to an increase in the cost of imported crude oil, gas and coal, is the main reason for the deficit in January,” the Commerce Department said.

Imports of crude oil, gas and coal cost $15.95 billion in January, more than double from $6.89 billion a year ago.

“Given the risk factors such as the recent rise in commodity prices and supply chain instability due to geopolitical jitters, trading conditions are not favorable for our exports this year,” Minister Moon Sung-wook said.

The ministry plans to introduce active support measures for exporters to bring the trade balance back into positive territory, he said.

South Korean financial markets are closed until Thursday for the Lunar New Year holiday.

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Reporting by Joori Roh; Adaptation by Richard Pullin

Our standards: The Thomson Reuters Trust Principles.

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