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Photo courtesy of Yonhap News |
[Alpha Biz= Paul Lee] South Korea’s knowledge services trade deficit widened to its largest level in 15 years in 2024, driven by surging payments for overseas digital services such as AI and streaming platforms.
According to preliminary data released by the Bank of Korea on March 19, the country posted a knowledge services trade deficit of $10.25 billion, with exports totaling $41.46 billion and imports reaching $51.71 billion. The deficit expanded by $2.88 billion from a year earlier, marking the largest increase since records began in 2010.
While exports of K-content such as music and games continued to grow, spending on foreign services—including AI platforms like ChatGPT and subscription-based streaming services such as YouTube Premium and Netflix—rose at a faster pace.
By category, information and communication services ($5.19 billion) and cultural and leisure services ($980 million) recorded surpluses. However, significant deficits were seen in professional and business services (-$9.39 billion) and intellectual property royalties (-$7.03 billion).
The deficit in software-related royalties, which includes subscription fees for mobile and computer applications, reached $4.2 billion, up $1.3 billion year-on-year. Meanwhile, R&D-related deficits expanded to $6.12 billion as Korean manufacturers increased outsourcing to overseas firms.
Regionally, Korea recorded a surplus of $6.9 billion with Asia, but posted large deficits with North America (-$7.72 billion) and Europe (-$3.69 billion).
The data underscores a structural trend in Korea’s export-driven economy, where increased reliance on advanced foreign technologies and services—particularly in high-value industries such as semiconductors and automobiles—is leading to rising outbound payments.
알파경제 Paul Lee 특파원(hoondork1977@alphabiz.co.kr)
