AI chip surge lifts South Korea to record surplus, behind only China
South Korea earned US$116.63 billion more from the world than it spent in the second quarter of this year – exceeding the combined current account surpluses of Germany and Japan for the first time on record. The current account measures a country’s trade and income with the world. It counts goods and services sold abroad, money earned on overseas investments and payments flowing the other way. A…
South Korea experienced a record current account surplus of US$116.63 billion in the second quarter, beating the combined surplus of Germany and Japan for the first time on record. The surplus was primarily driven by a surge in demand for semiconductors, with exports reaching US$113.89 billion in the three months to June, up 181.6 percent from the same period last year.
Prices for memory chips have skyrocketed due to the global artificial intelligence boom, with US manufacturer Micron Technology reporting price hikes of up to 80 percent quarter on quarter. South Korea's second-quarter surplus placed it second only to China among the 36 major economies tracked by the International Monetary Fund.
President Lee Jae Myung welcomed the news, stating that it marked a significant opportunity for the economy. However, some economists warn that the current surplus may be a transient boom, as semiconductor prices are expected to fall sharply in two to three years. This could put South Korean exports at a disadvantage and potentially expose Seoul to pressure from the United States.
Additionally, the influx of foreign currency has made South Korean exports costlier abroad, which could further affect the economy.
Written by urgent.news from South China Morning Post's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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