S. Korea' Export Marks Record Drop in January

S. Korea's exports made a record decline of 32.8 percent in January from the same period in the previous year due to the cutback in the overseas demand for locally made goods along with the global economic recession, according to a government report on Monday.

The report by the Ministry of Knowledge Economy showed that the country's exports reached 21.7 billion U.S. dollars, while imports lost 32.1 percent to 24.6 billion dollars, together to sum up a trade deficit of 2.9 billion dollars.

The plunge in export shows the steepest slope since 1980, the year the country started announcing monthly tallies. Meanwhile, the amount of drop in import is at its peak since July 1998. The deficit also made a downturn from its surplus of 542 million dollars in December.

Exports of most items, including automobiles, car parts, computers, consumer electronic goods, marked negative growth, with ships being the only product to show an increase of 20 percent.

"Besides the general drop off in demand around the world, a reduced number of working days due to the Lunar New Year holidays, and halting of production by carmakers to deal with rising inventory contributed to drop in exports," said Chung Jae-hoon, head of the ministry's trade and investment promotion office.

Exports to most countries plotted negative values as shipments to China and the European Union in the month reduced 32.2 percent and 46.9 percent. Also, exports to the United States and Japan fell 21.5 percent and 29.3 percent, respectively, according to the report.

On the other hand, imports declined in January with the decrease in the country's demand for foreign consumer and capital goods by 20 percent. However, imports of gas and coal climbed 51 percent and 62 percent from the year before due to cold weather.

As global trade volume is expected to contract 2.8 percent in 2009 from a gain of more than 4 percent last year, the export market is likely to stay shrunk for the near future, the ministry said.