Sound • Video service in the first over USD 500 million surplus thanks to ‘Hallyu Effect’.
Moon Hae Won | hmoon3@ | 2017-02-21 14:41:16
Korea``s trade balance of sound and video services exceeded its first USD 500 million last year thanks to Hally(Korean wave) effect such as the Korean drama "Descendents of the Sun" export and K-pop spread. However, experts of cultural field point out that there are also concerns that the outlook of Hally is not optimistic as China is tightening its regulations towards Hallyu due to THAAD deployment.
According to the service trade statistics of the Bank of Korea on February 20, the sound and video and related services recorded a surplus of USD 510.3 million last year (provisional estimate: about KRW 590 billion). The surplus has jumped up to 2.1 times of 2015 (USD 244.9 million). It is the first time of over USD 500 million of Hallyu related service since the bank of Korea started publishing statistics in 2006.
This section is very close to the Hallyu content in the balance of payments. The section includes services such as dramas, TV programs, movies, radio and musicals related services along with recording trade. Entertainers’ profit of overseas performances is included in the section as well.
Even though the sound and effect service surplus size was small, this section is being emerged as big moneymaker out of the overall services, which are still struggling to overcome loss. Korea’s service deficit hit a record high of USD 17.61 billion due to deteriorating transportation balance last year.
Last year, the Hallyu culture was more active than ever. According to the Korea Film Commission, export of Korean movies last year rose 82.1 % year-on-year to USD 109.9 million. The drama "Descendents of the Sun" got very popular in China and K-pop popularity keeps growing in the United States and Latin America.
According to the Korea Foundations’ recently published ``Current Status of Korean Wave in 2016``, 1652 Hallyu clubs have been formed in 88 countries and 59.39 million members are active as of December last year. The number of clubs increased by 10.6 % and membership increased by 68 % comparing to 2015.
However it is not easy to guarantee on continuous surplus increase of the sound and video service of Hallyu.
It is because China is tightening its control over Hallyu due to diplomatic dispute between Korea and China, which were caused by THAAD (Theater of High Altitude Area Defense) issue. Since South Korea and the US government announced their decision to THAAD deployment in July last year, China has tightened its control over non tariff barrier such as Hallyu, Korean groceries, cosmetics and Chinese tourist decrease, Lotte tax investigation etc. which are suspected as China’s revenge on THAAD deployment.
Due to this issue, quarterly imports of sound and video services recorded the highest figure of USD 240.6 million in the second quarter of last year, down from USD 280.2 million in the third quarter and USD 190.8 million in the fourth quarter.
An anonymous official of the business community said optimistically that ‘As China needs to make a close relationship with Korea, it will be difficult for China to take powerful economic retaliation measures indiscriminately by political judgment. I do not think China’s regulations will spread and affect negatively on the Korean economy’.
Some experts point out that the Korea has to reduce Hallyu dependence on China in unsolved the THAAD issue. Park Sung Hyun- researcher of Hallyu convergence research center of Korea University said that ‘The Korean wave in China will not go down in a short period of time. But the similar case of Japan, in which existing Hally popularity has been maintained but new Hallyu appearance are not easy, may happen to China as well’.
By Moon Hae Won hmoon3@dt.co.kr
[ copyright ⓒ The Digitaltimes ]
According to the service trade statistics of the Bank of Korea on February 20, the sound and video and related services recorded a surplus of USD 510.3 million last year (provisional estimate: about KRW 590 billion). The surplus has jumped up to 2.1 times of 2015 (USD 244.9 million). It is the first time of over USD 500 million of Hallyu related service since the bank of Korea started publishing statistics in 2006.
This section is very close to the Hallyu content in the balance of payments. The section includes services such as dramas, TV programs, movies, radio and musicals related services along with recording trade. Entertainers’ profit of overseas performances is included in the section as well.
Even though the sound and effect service surplus size was small, this section is being emerged as big moneymaker out of the overall services, which are still struggling to overcome loss. Korea’s service deficit hit a record high of USD 17.61 billion due to deteriorating transportation balance last year.
Last year, the Hallyu culture was more active than ever. According to the Korea Film Commission, export of Korean movies last year rose 82.1 % year-on-year to USD 109.9 million. The drama "Descendents of the Sun" got very popular in China and K-pop popularity keeps growing in the United States and Latin America.
According to the Korea Foundations’ recently published ``Current Status of Korean Wave in 2016``, 1652 Hallyu clubs have been formed in 88 countries and 59.39 million members are active as of December last year. The number of clubs increased by 10.6 % and membership increased by 68 % comparing to 2015.
However it is not easy to guarantee on continuous surplus increase of the sound and video service of Hallyu.
It is because China is tightening its control over Hallyu due to diplomatic dispute between Korea and China, which were caused by THAAD (Theater of High Altitude Area Defense) issue. Since South Korea and the US government announced their decision to THAAD deployment in July last year, China has tightened its control over non tariff barrier such as Hallyu, Korean groceries, cosmetics and Chinese tourist decrease, Lotte tax investigation etc. which are suspected as China’s revenge on THAAD deployment.
Due to this issue, quarterly imports of sound and video services recorded the highest figure of USD 240.6 million in the second quarter of last year, down from USD 280.2 million in the third quarter and USD 190.8 million in the fourth quarter.
An anonymous official of the business community said optimistically that ‘As China needs to make a close relationship with Korea, it will be difficult for China to take powerful economic retaliation measures indiscriminately by political judgment. I do not think China’s regulations will spread and affect negatively on the Korean economy’.
Some experts point out that the Korea has to reduce Hallyu dependence on China in unsolved the THAAD issue. Park Sung Hyun- researcher of Hallyu convergence research center of Korea University said that ‘The Korean wave in China will not go down in a short period of time. But the similar case of Japan, in which existing Hally popularity has been maintained but new Hallyu appearance are not easy, may happen to China as well’.
By Moon Hae Won hmoon3@dt.co.kr