S. Korea posts first surplus in cultural trade balance

Park Min-young in Seoul/The Korea Herald
Asia News Network

Seoul (The Korea Herald/ANN) - Buoyed by surging popularity overseas of K-pop, the nation's trade balance in the culture and entertainment service sector was positive for the first time ever, data showed Sunday.

The trade surplus of cultural and entertainment products, including movies, music, TV programs and games, reached $37.3 million over the first three quarters this year, according to financial information provider FnGuide and the Bank of Korea.

The turnaround is noteworthy as the balance had been in the red in the industries for many years. In 2006, it marked a deficit of $300 million during the same period, in 2007 $480 million, in 2008 $360 million, in 2009 $320 million, in 2010 $380 million and last year $218.5 million.

The audio and video service sector, especially, ran a deficit up until the third quarter at minus $32.1 million collectively, but is showing a turnaround as it marked a surplus of $16.7 million won in the third quarter alone. Psy's "Gangnam Style" alone, released in July, brought in $13.4 million in the audio sector.

The overall service sector is also forecast to post a surplus this year, led by the culture and entertainment service sector. It marked a $650 million deficit in the first quarter but turned around to a surplus of $2.3 billion in the second and $650 million in the third.

The earnings outlook for music, film and game-related companies are bright as well.

S.M. Entertainment, one of the top three entertainment agencies in Korea and home to Girls' Generation, Super Junior and TVXQ, is expected to mark an operating profit of 69.7 billion won, which would be a 235.2 percent increase from last year. The operating profit of Psy, Big Bang and 2NE1's agency YG Entertainment is projected to reach 26.4 billion won, a year-on-year increase of 52.4 percent.

CJ CGV's operating profit is expected to reach about 107.6 billion won this year, a jump of 52.3 percent from the previous year.

Game maker Com2us' operating profit is expected to increase by 54.3 percent to 19.2 billion won, and Gamevil by 48.7 percent to 26 billion won.