SEOUL, Feb. 06 (AJP) -The black figure in South Korea’s current account stretched to a monthly high in December and an annual high for 2025 thanks to red-hot chip sales, but the bulk of the gains went to defending the Korean currency against rapid depreciation and funding outbound investments, data showed.
According to data released by the Bank of Korea on Friday, the current account in December recorded a surplus of $18.7 billion, an increase of more than $6 billion from the previous month. This marked the largest monthly surplus on record. For the full year, the surplus reached $123.05 billion, also rewriting the all-time high.
Much of the glow fades when the data is set against the financial account, which measures capital flows.
The financial account posted net asset increases of $23.77 billion in December, more than doubled from a year earlier, and $119.76 billion for full-year 2025, compared with $96.87 billion in 2024, implying that much more Korean money flowed out than in.
The current-account surplus was driven largely by exports, which rose more than 13 percent to $69.54 billion.
Chips were the primary earner, with exports expanding 43.1 percent to about $20.92 billion. Information and communication technology devices, including mobile phones, also performed strongly, rising 24 percent to $4.77 billion.
Petroleum product exports reached $4.24 billion, up 6 percent from a year earlier, following a four-week improvement in refining margins through late December and a year-end surge in demand.
Ships, once a pillar of export growth through October, fell 3 percent to $2.89 billion, marking a second consecutive month of decline.
Automobile exports, which exceeded $6 billion in November, slipped back to $5.59 billion. Major automakers such as Hyundai and Kia have entered “contingency plans” as inventories subject to a potential 25 percent tariff under U.S.-Korea trade negotiations hit the market.
Steel products also remained sluggish. Although the decline narrowed from November’s 6.3 percent drop, exports still fell 1.7 percent to $4.02 billion. Home appliance exports slid 8.1 percent to $560 million amid competition from cheaper Chinese products.
Imports totaled $57.37 billion, up 4.6 percent from a year earlier.
The decline in raw material import prices, which hovered around 8 percent in November, slowed sharply to just 1 percent. This reflected the won’s weakness, which averaged 1,467.3 per dollar in December, and rising prices for selected items.
While crude oil imports fell 14.4 percent to $5.59 billion and gas dropped 33.4 percent to $2.03 billion, mining imports surged. Mineral imports rose 22.3 percent to $2.55 billion, while other metals, including rare earths, climbed 11.8 percent to $1.55 billion.
The largest increase was seen in consumer goods, which jumped 17.9 percent to $9.72 billion. Durable goods, in particular, surged 30.8 percent to $4.37 billion, reflecting soaring prices for smartphones and computers as general-purpose chips were diverted to the AI business-to-business market, along with rising imported car sales.
Investment income reached a record $30.17 billion in 2025, up $1.47 billion from a year earlier. Dividend income accounted for more than two-thirds of the total, at $20.19 billion.
But the devil is in the details.
In December, outward securities investment by residents rose 17.2 percent to $14.37 billion, with equities accounting for $11.83 billion. In contrast, inward investment by foreigners fell to $5.68 billion from $5.81 billion in November, with just $410 million flowing into stocks and the remainder into bonds.
For full-year 2025, outbound securities investment reached $140.3 billion, nearly triple the $52.54 billion invested in local securities by foreigners.
Direct investment showed a similar trend. Outward investment rose $6.49 billion, while inward foreign investment increased by only $5.17 billion. The gap, however, narrowed sharply from October, when outbound investment was nearly ten times larger than inbound.
For 2025, outbound direct investment reached $41.23 billion, nearly tripling the $15.8 billion invested in Korea by foreign entities.
It is little wonder that Korea’s pledge of up to $350 billion — including about $200 billion in cash — to the United States has weighed on the won, despite strong exports and a buoyant stock market.
Reserve assets fell $4.44 billion in December, compared with a $1.69 billion increase in November.
The country’s foreign exchange reserves fell $2 billion in December and $2.15 billion in January as authorities intervened to support the won and curb import-driven inflation through currency swap arrangements with the National Pension Service.
As of 10:15 a.m. Friday, the won was trading at 1,470.2 per dollar, down 1.2 won from the previous close. After stabilizing briefly near the 1,420 level earlier this month, the currency is again facing renewed weakness.
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