South Korea Posts $46.1 Billion Current Account Surplus as Chip Exports Surge

South Korea posted a current account surplus of $46.11 billion in August, the second-largest monthly total on record, as booming semiconductor shipments drove a sharp expansion in exports, preliminary central bank data showed Thursday.

The result trailed only the record $49.73 billion surplus registered in June. It also surpassed July’s $42.08 billion, which had previously ranked second, and marked the third consecutive month in which the surplus exceeded $40 billion.

The cumulative current account surplus for the first eight months of the year reached $279.2 billion. That was nearly four times the $69.67 billion recorded during the same period a year earlier, underscoring the scale of the export-driven improvement in South Korea’s external balance.

The goods account was the main source of strength, recording a $46.81 billion surplus in August. That was also the second-highest monthly figure, behind the $47.89 billion surplus posted in June.

Exports climbed 82.1 percent from a year earlier to $104.8 billion, remaining above $100 billion for a third straight month. The increase was led by products tied to the global technology cycle. On a customs-cleared basis, exports of solid-state drives jumped 366.8 percent, while semiconductor shipments rose 206.1 percent. Petroleum product exports increased 64.9 percent.

The gains were not evenly distributed across industries. Passenger vehicle exports fell 30.1 percent from a year earlier, while ship exports declined 45.2 percent, highlighting the concentration of the latest trade upswing in chips and other selected products.

By destination, shipments to China increased 119.4 percent, exports to Southeast Asia rose 91.7 percent and those to the United States gained 89.2 percent. The broad regional increases helped sustain the goods surplus despite weakness in autos and ships.

Other components provided a more mixed picture. The transport account surplus widened to $520 million from $60 million in July as export freight rates increased. The deficit in the intellectual property account narrowed to $390 million from $540 million. The primary income surplus, however, fell to $1.92 billion from $4.35 billion as quarterly dividend payments on portfolio investments were made.

The August figures show how strongly the semiconductor cycle is supporting South Korea’s economy and external finances. They also leave the trade outlook more exposed to changes in global technology demand because much of the recent acceleration came from chips and computer storage products.