Bank of Korea 'November 2020 Balance of Payments (Preliminary)'
Cumulative Current Account Surplus from January to November at 63.94 Billion USD
[Asia Economy Reporter Kim Eun-byeol] South Korea's current account surplus has expanded for six consecutive months compared to the same month last year. With strong performance in key export products such as semiconductors, the annual current account surplus is expected to exceed the Bank of Korea's initial forecast of $65 billion.
According to the "November 2020 Balance of Payments (Provisional)" released by the Bank of Korea on the 8th, the current account surplus in November last year was $8.97 billion. This is an increase from November last year ($5.97 billion), continuing a trend of expanding surplus for six consecutive months compared to the same month last year.
The goods balance recorded a surplus of $9.54 billion, expanding by $2.15 billion compared to the same month last year. Despite the global resurgence of the novel coronavirus infection (COVID-19), exports continued to perform well, driving the goods balance surplus.
Exports in November amounted to $47.02 billion, turning to an increase compared to the same month last year after one month. The daily average export also continued its growth for two consecutive months at $2.04 billion. Exports appear to have increased mainly in semiconductors, information and communication devices, and chemical products.
Imports recorded $37.48 billion, decreasing for two consecutive months compared to the same month last year as oil prices continued to decline.
The services balance showed a deficit of $720 million, with the deficit narrowing by $1.17 billion compared to the same month last year. The travel balance recorded a deficit of $500 million, reducing the deficit by $450 million compared to the same month last year. The transportation balance turned to a surplus compared to the same month last year. Although air passenger transport income decreased, transportation income centered on air cargo transport recorded $2.36 billion.
However, the current account surplus in November did not reach $10 billion for the second consecutive month, due to a decrease in primary income balance caused by increased dividend payments by foreign direct investment corporations. Dividend payments in November recorded $1.87 billion, and the primary income balance recorded a surplus of $420 million, down $550 million from the same month last year ($970 million).
The net financial account (assets minus liabilities), indicating capital inflow and outflow, increased by $8.95 billion. In direct investment, domestic investors' overseas investment increased by $3.33 billion, and foreign investors' domestic investment increased by $1.33 billion.
Securities investment saw domestic investors' overseas investment and foreign investors' domestic investment increase by $9.41 billion and $4.32 billion, respectively. This marks eight consecutive months and six consecutive months of growth, respectively.
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