S. Korea forecast to log US$3 bln trade surplus this month: gov't

(ATTN: UPDATES with more details in para 3-5; ADDS new information from para 9)
SEOUL, March 5 (Yonhap) -- South Korea is set to record a second-consecutive
monthly trade surplus in March thanks to a continued increase in overseas
shipments of vessels, the government said Thursday.

"The March trade balance is expected to reach around US$3.3 billion, similar to
the level in February, on the back of sustained growth in exports of ships," the
prime minister's office said in a statement on the outcome of a meeting of top
economic policy makers.
Officials who were at the meeting, including Prime Minister Han Seung-soo,
Finance Minister Yoon Jeung-hyun and Financial Supervisory Commission head Chin
Dong-soo, predicted that the trade surplus for this year will likely surpass the
initial forecast of $12 billion.
South Korea reported its first trade deficit in over a decade in 2008 with the
imbalance reaching $13.3 billion, mostly on a surge in crude oil prices. January
2009 saw a deficit of $3.35 billion, but the country recorded a $3.29 billion
surplus last month.
The prime minister's office added that participants at the meeting agreed to seek
measures to encourage businesses to increase investment since the government's
fiscal measures alone are of limited efficacy in reviving the slump in domestic
consumption.
"Respective government agencies will listen to companies and provide means to
reduce investment risks," the officials agreed at the meeting.
In January, facility investment plunged 25.3 percent from a year earlier, slowing
further from the previous month's 23 percent decline, according to the National
Statistical Office.
Policymakers also said that they would, if required, seek to inject more
foreign-exchange stabilization bonds at an "adequate time" as part of measures to
cope with volatile financial market conditions.
Related to trade balance predictions, the Ministry of Knowledge Economy said
earlier in the day that if international crude oil prices remain stable
throughout the year, the country's trade surplus may reach $17-18 billion by
year's end.
The average price of Dubai crude plunged to $43.50 per barrel this year from
$94.29 in 2008.
The ministry in charge of industrial policies and trade promotion added that its
export target of $427 billion for the year was based on economic growth of 2
percent on-year in 2009. Seoul had since downgraded the estimate to negative 2
percent due to the global economic slump.
It, however, said that the worldwide financial crisis may make it hard to attract
$12.5 billion worth of foreign direct investment this year.
yonngong@yna.co.kr
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