South Korea’s balance of payments surplus for industries linked to K-pop businesses has recovered to levels seen before China’s 2016 ban on domestic cultural contents over soured diplomatic relations, tracking data showed Sunday.
According to the Bank of Korea Economic Statistics System, Korea recorded a BOP surplus of $114.7 million for music, video and related services in the first quarter of this year — highest surplus for the category since $132.4 million recorded in the third quarter of 2016.
BOP represents the difference between all the money a country earns from exports and expenditure on imports during a given period — with a surplus indicating exports exceed imports.
For years, Korea’s entertainment and cultural contents have been enjoying sizeable popularity in China, boosting related exports and the BOP surplus for the category.
But in July 2016, Korea decided to deploy a US missile defense system on its territory, a move opposed by China. In retaliation, China imposed a ban on Korean cultural contents, including music, performances, films and TV shows.
Months later, China stopped granting approval to Korean celebrities, concerts and shows, dealing a major blow to the domestic entertainment exports which relied heavily on the market.
Two and a half years has since passed, and Korea’s BOP for the music and entertainment services sector has climbed back to previous levels.
Korea earned $194.1 million from exports in the first three months of this year from the music, video and related services. At the same time, imports in the category reached $79.4 million in the first quarter, down by $36.9 million on-quarter. This brings the music category’s BOP surplus for the first quarter of 2019 to $114.7 million.
The BOK attributed the recovery to improved China-Korea diplomatic relations as well as the recent breakout success of K-pop boy group BTS worldwide, including in North America.