South Korea's trade surplus shrank from a month earlier in July as exports slipped at a greater pace than imports, the government said Wednesday. The country's trade balance came to US$2.7 billion in the black last month, compared with a surplus of $4.96 billion in June, according to the Ministry of Knowledge Economy. Still, July marks the sixth consecutive month the country has posted a trade surplus since January when the country's trade balance went into the red for the first time in 24 months. Exports dropped 8.8 percent on-year to $44.6 billion last month, making a sharp turnaround from a 1.1-percent gain in the previous month. Imports slipped 5.5 percent to $41.9 billion, continuing a year-on-year drop for the fifth consecutive month since February, according to the ministry. The ministry attributed the drop in exports to continuing troubles in Europe. "Export growth turned to the negative amid a continued economic slowdown in major markets, such as the European Union and China, which may continue to weaken the country's exports in the future," it said in a press release. In the first 20 days of July, shipments to China and Europe dropped 0.5 percent and 4.9 percent, respectively, from the same period last year, the ministry said, though exports to the so-called developed nations, such as the United States and Japan, surged 12.3 percent during the cited period. Outbound shipments of petrochemical products dropped 22.3 percent from the same period last year with exports or deliveries by the shipbuilding industry plunging 57.5 percent, apparently representing shrinking demand amid a global economic downturn, South Korea's news agency (Yonhap) reported. Only exports of LCD panels and general machinery showed slight increases of 6.7 percent and 3.5 percent, respectively, with shipments of automobile parts also rising 1.9 percent from a year earlier, according to the ministry. The drop in imports was partly led by a decrease in the amount of money the country spent to purchase petroleum, despite a slight increase in the volume of oil purchased. In July, South Korea purchased $8.03 billion worth of oil from overseas, down 8.7 percent from the same period last year, according to the ministry, which attributed largely to a 8.3 percent fall in oil prices to $102.4 per barrel from $111.7 in July 2011. A ministry official said the country's exports will likely continue to shrink during the remainder of the year, noting conditions for exports are usually worse in the second half than the first half of a year. "We believe conditions will be better in August, but for the entire second half, we will first have to wait and see how we do next month," Han Jin-hyun, the head of the ministry's trade-investment policy bureau, told a press briefing. The government had initially forecast the country's exports to grow 6.7 percent this year with its imports growing 8.7 percent on-year. The ministry last month revised down its outlooks to a 3.5 percent growth for exports and 5 percent gain for imports. Han said the country's trade surplus will likely come to around $23 billion as earlier predicted, but that the key issue was how much of that will come from a growth in exports, as opposed to a usual gap between exports and imports.