Seoul - Arabstoday
South Korea\'s trade balance turned into the red for the first time in two years last month due to a drop in exports amid worsening global economic woes, the government said Wednesday.The country recorded a trade deficit of US$1.96 billion last month, a sharp turnaround from a surplus of $2.9 billion a year earlier, according to the Ministry of Knowledge Economy. The country last recorded a trade deficit in January, 2010.Exports slipped 6.6 percent on-year to US$41.54 billion in January while imports grew 3.6 percent to $43.49 billion, the ministry said.The ministry attributed the drop in exports partly to a global economic downturn caused by the eurozone financial crisis, but also to what it called seasonal factors.\"There is a tendency for worsening exports every January due to a cut in shipments following large year-end sales,\" it said.January also marked the first time in 27 months for the country\'s exports to shrink on a year-on-year basis.Shipments of petroleum products, such as gasoline, jumped 39.5 percent on-year in January, but exports of ships and mobile communication devices, including smartphones, dropped 41.5 percent and 39.7 percent, respectively. By nation, shipments to Japan jumped 37.2 percent from a year earlier with exports to the United States also rising 23.3 percent.Shipments to European countries, however, plunged 44.8 percent on-year, more than offsetting the country\'s gains in exports to other areas, according to the ministry.The ministry said the country\'s trade deficit further widened because of a significant rise in the amount of money spent on oil imports, due to a hike in global oil prices. In January, the country imported some 80 million barrels of oil, down from 84.3 million barrels imported during the same period last year, but the cost of oil imports surged more than 17 percent to $9.02 billion from $7.67 billion.The ministry said the country\'s exports will likely turn to the black again this month with an increase in the number of working days to 23 from 19 in the same month last year. \"There still needs to be close monitoring of conditions as global uncertainties continue to exist, due to a delay in a resolution of the European financial crisis and additional sanctions on Iran,\" it said.