S. Korea posts current account deficit in first half

South Korea recorded a current account deficit in the first half for the first time in nine years as a result of large shortfalls from February to April, the nation's central bank said Thursday.

The current account deficit reached US$267.6 million in the January-June period, the first half-year red ink since the first half of 1997, when the shortfall reached $10.1 billion, according to the Bank of Korea.

South Korea registered a current account deficit for a third month in April, the first time since the end of 1997, due to large overseas dividend payments. The three-month deficit reached $2.8 billion.

The current account is the broadest measure of trade, service and investment flows into and out of the country.

In June, South Korea recorded a current account surplus of $1.1 billion, down from a revised surplus of $1.4 billion a month earlier. An increase in overseas dividend payments cut the surplus.

The trade balance, which accounts for the largest part of the nation's current account surplus, posted a surplus of $2.9 billion in June, compared with a surplus of $2.8 billion a month earlier.

Exports, on a customs-cleared basis, grew 18.6 percent to $28.1 billion last month from a year earlier, while the imports rose 21.9 percent to $25.9 billion.

The service account, which covers South Korean payments of transportation and other service fees, posted a deficit of $1.2 billion in June, compared with a $1.4 billion shortfall a month earlier.

The income account, which includes South Korea's dividend payments overseas, recorded a deficit of $158.6 million last month, compared with a $387.1 million surplus a month earlier.

The capital account, which tracks cross-border investments, posted a net outflow of $1.7 billion, compared with a net inflow of $513 million a month earlier, as foreign investors withdrew investments from the local stock market, the central bank said

Seoul, July 27 (Yonhap News)