South Korea's August import and export statistics released by the South Korean Ministry of Industry, Trade and Energy on September 1 show that the South Korean Ministry of Industry, Trade and Energy released data on Thursday that the trade deficit in August nearly doubled from 4.8 billion US dollars in July to 95%. US$10.4 billion, approaching the total trade deficit of US$10.4 billion from January to June. 

Among them, South Korea's exports in August reached 56.67 billion US dollars, an increase of 6.6% over the same period last year, maintaining the growth momentum for 22 consecutive months. But the country's imports in August rose 28.2% year-on-year to $66.15 billion as higher energy and commodity prices pushed up import costs.

Because South Korea produces chips, monitor, refined oil and other products vital to the global economy, its trade data is often seen as a "barometer" of international demand. Data show that semiconductor exports, the country's largest source of export revenue, fell 7.8% year-on-year in August, the first decline in 26 months. However, exports of automobiles rose by 35.9% and exports of rechargeable batteries increased by 35.7%.

Kim Hyo-jin, an economist at South Korean Speculative organization KB Securities, said: "Given that imports are unlikely to decline as much as exports, we expect the trade deficit to continue at least until early next year... The key is energy prices, be it oil or Natural gas, there's just too much uncertainty around."

In the context of the widening trade deficit, in order to further boost exports, on August 31, the South Korean government jointly issued the "Strategy for Enhancing Export Competitiveness". the South Korean government will provide financing support of 351 trillion won (about 1.81 trillion yuan), the highest in history, to control the three negative factors of declining exports to China, falling chip prices and companies with high energy costs, while supporting South Korea’s main export industries. technology R & D.

The record trade deficit also hit the won. As of press time, the exchange rate of the US dollar against the Korean won broke through the key point of 1350. Analysts at Morgan Stanley said a break above that level could pave the way towards 1,370. 

Source:  sina