Korea trade deficit with Japan grows

South Korea's inability to sell cars to Japan while it imported $53 million worth of Japanese cars from January to April helped contribute to Korea's biggest ever trade deficit with its neighbor during that period, the Korea Herald reported Tuesday.

The deficit ballooned to $10.3 billion in the first four months of the year, greater than the $9.2 billion deficit during the same period in 2007. Other contributing factors were Korea's reliance on steel, chemical products and high-tech manufacturing machinery. The report said the deficit with China nearly wiped out South Korea's $10 billion surplus with China and the European Union during the same period.

Like the United States, Japan is in talks with South Korea to establish a free trade agreement, though a commerce official quoted by the newspaper said the increasing deficit may turn public opinion in Korea away from such a deal. 

Source: American Shipper