South Korea posts first trade deficit in two years

SEOUL: South Korea posted its first trade deficit for two years in January as exports declined on falling overseas demand, officials figures showed Wednesday.

The Ministry of Knowledge Economy said exports last month fell 6.6 percent from a year earlier to $41.54 billion.

Imports rose 3.6 percent to $43.49 billion from January 2011, leaving a trade deficit of $1.96 billion compared to a surplus of $2.9 billion a year before.

January marked the first time in 27 months that exports had shrunk year-on-year. The ministry attributed the drop partly to the global economic downturn but also to seasonal factors.

"There is a tendency for worsening exports every January due to a cut in shipments following large year-end sales," it said.

It said the deficit rose further because of a significant rise in prices of imported oil.

Economists said the January data alone would not indicate a trend for the export-driven economy, because exporters often boost shipments in December to inflate their full-year results.

Copyright AFP (Agence France-Presse), 2012