South Korea’s current account surplus came to $5.97 billion in November, marking a surplus for the seventh consecutive month, amid sluggish exports, data from the Bank of Korea showed Tuesday.

The central bank’s preliminary data showed that the nation’s current account surplus in November grew $840 million. It recorded a surplus in May 2019 after posting a deficit in the previous month. The surplus in November marks the first on-year surplus growth in nine months. 

The growth in the current account surplus came as the country has struggled to deal with sluggish exports, which have been weighed down by risks stemming from the US-China trade war and a slump in the global chip market.

Korea’s exports and imports declined 10.3 percent and 11.7 percent on-year to $46.5 billion and $39.11 billion, respectively, in November.

Its exports have declined on-year for 12 consecutive months.

The export price index of semiconductors and petroleum products, Korea’s key export items -- constituting nearly 40 percent of the total outbound shipments -- also dropped. The price index of semiconductors fell 33 percent on-year in November, while the petroleum products index shed 7.4 percent.

Meanwhile, its service account saw its deficit narrow by $300 million to $1.89 billion.

The improvement in the service account deficit was a result of a drop in the tourism account deficit, which shed $400 million and came to $950 million. The figure was buoyed by a 7.9 percent on-year increase in Chinese and ASEAN visitors and a noticeable 9 percent decline in the number of Koreans traveling abroad.

The soured Korea-Japan ties due to “comfort women” issues and Japan’s export curbs of key materials needed for manufacturing displays and chips has also dealt a blow to the local tourism industry.

The country’s primary income account surplus came to $970 million, up from a $340 million surplus the year before.

Overseas investments by Korean firms also hit a 13-month high with an almost combined $4.2 billion.

Despite a rosy outlook for the current account surplus, a BOK official expressed concerns that the rising oil prices due to geopolitical tensions between the US and Iran could sour the circumstances.

“If oil prices continue to rise over the US-Iran conflict, it will work as a negative factor for the current account,” the official said.

“Under the premise that the trade volume remains flat, a $10 rise in global oil prices could translate into a $9 billion decline in the current account surplus.”

By Jung Min-kyung (mkjung@heraldcorp.com)