South Korea registers its first shortfall in 7 years
South Korea saw its first current-account deficit in April in seven years, officials said on Wednesday (June 5), while the export-dependent economy is grappling with the trade war winds between the United States and China.
The eleventh biggest economy in the world reported a USD 660 million current-account deficit in April, the numbers proved by the Central Bank of Korea.
The current account of a country is a wide range of its trade with the remainder of the globe, including products, facilities, and transfers produced and obtained.
South Korea’s trade surplus dropped from USD 9,62 billion a year ago to USD 5,67 billion in trade loggerheads with the United States and China. Beijing, which absorbs a third of its imports, is Seoul’s biggest trading partner.
Crucial semiconductor sales declined 12.7%, as the global supply for computer devices dropped, and business rivalry increased.
Meanwhile, sales of dividends abroad jumped to USD 6.78 billion, the second largest in the history of the country.
Many South Korean firms paid dividends in April, and authorities stated that the current account deficit was subject to environmental variables. It was the first since April 2012.
One day after the Bank of Korea revealed that the workforce shrank 0.4% quarter-on-quarter in the first three months, 0.1% below its previous forecast.
It was the most significant decline in the South since a 3.3% decline at the height of the worldwide economic recession in early 2008.
In 2018, South Korea’s GDP rose by 2.7%, the weakest rate in six years.
The spate of trade between Beijing and Washington has harmed the chances of world economic growth, targeting Asian export-reliant nations as China’s economy reels trillions of Chinese products from US tariffs.