Korea's Trade Surplus with China, U.S. Plummets

Korea's current account surplus from trade with China and the U.S. dropped almost 20 percent last year.

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The decline is partly due to sluggish economies in China and the U.S., but Korea's overall current account surplus actually rose around 25 percent in 2015 to US$105.9 billion thanks to low global oil prices.

According to preliminary figures for 2015 announced by the Bank of Korea on Friday, the surplus from trade with China fell 19 percent to $45.1 billion, down for the second year after peaking at $56.7 billion in 2013.

The BOK said exports of display panels and chemical products dropped, depleting the goods surplus account surplus, while the service account surplus also dwindled.

The surplus from trade with the U.S. also plunged more than 17 percent over the same period to $33.9 billion.

The main reason is a widening deficit in tourism, intellectual property and other service sectors. The service account deficit with the U.S. soared to a record $14.4 billion last year.

But Korea's deficit in trade with the Middle East fell around $45.6 billion to $34.4 billion due to low oil prices.

The average price of Dubai crude last year stood at $51.10 a barrel, down $45.30 compared to 2014, resulting in less money spent on importing crude oil.

Korea's account deficit with the EU also shrank more than 30 percent as imports of petroleum products dropped markedly.

But the perennial deficit in trade with Japan widened from $16.2 billion in 2014 to $19.7 billion as fewer Japanese tourists came to Korea and more Koreans went to Japan.

Declining exports also reduced the surplus in trade with Southeast Asia and Latin America by 16 percent and 19 percent.

Global exports fell around 13 percent last year, but Korea's dropped only around eight percent.