eFM News

South Korea's trade deficit with Japan has edged up this year, showing signs that a local boycott of Japanese goods is losing steam.

Seoul posted a trade deficit of over 16.5 billion dollars in the January-October period, compared with 16.4 billion dollars during the same period a year earlier, according data released Thursday from the Korea International Trade Association.

Exports to the neighboring country fell 13 percent on-year to 20.6 billion dollars over the cited period, with imports dropping 7.3 percent to nearly 37.2 billion dollars.

In July last year, South Koreans launched a boycott in protest of Japan's export curbs on some key industrial materials to South Korea, apparently in response to South Korea's top court ordering Japanese firms to compensate Korean victims of Japan's wartime forced labor in 2018.

In the wake of the boycott, South Korea's trade deficit with Japan came to about 19.2 billion dollars, the lowest red ink since 2003.

Seoul's trade deficit with Tokyo had ranged from 20 billion to 30 billion dollars since 2004.

The downturn in the trade deficit continued until the first half of this year, but South Korea's trade gap began to widen as exports fell faster than imports.

Exports to Japan swung to a 3 percent decline in April from a 0.1 percent gain in March, with the decreasing rate expanding to 13 percent last month.

Imports from Japan tumbled nearly 22 percent on-year in January, but the rate narrowed to 7.3 percent in October.

It is expected that trade between the two countries will increase further when the mega trade deal involving Asia-Pacific countries, known as the Regional Comprehensive Economic Partnership, comes into effect next year.