Economic perception has been not so good amid the political risks at home and risk factors beyond borders.
Moon Hye-ryeon explains.
The South Korean government has raised concerns over potential economic downturn risks, highlighting a decline in consumer and business confidence.
That’s according to the latest economic green book – a monthly economic assessment report – released by the Finance Ministry on Friday.
The first report to be released since the martial law incident last Tuesday states that while inflation remains under control, growing domestic and international uncertainties could further dampen economic sentiment, raising the likelihood of economic risks contributing to an economic slowdown.
The report reflects a darker outlook compared to the previous month, with the term “gradual economic recovery” omitted and replaced with concerns about growing uncertainty.
“The only official data we have is on industrial activity from October, and there isn’t enough preliminary data to make an accurate judgment about the current economic situation. We asked ourselves, “What is the most accurate word to describe the current economic situation?” We also reviewed past green book assessments from similar situations in the past.”
Although terms like “martial law” or “impeachment crisis” were not explicitly mentioned, the government noted that the prolonged political turmoil is likely to cause households to tighten spending and businesses to slow down investment.
The report also revealed weak domestic recovery trends, with private consumption up only point-five percent from the previous quarter in the third quarter of the year.
Retail sales in October showed a mixed picture, with non-durable goods and semi-durable goods showing a rise in sales while durable goods saw a significant decline month-on-month.
Additionally, October’s facility investment and construction figures showed negative growth, signaling persistent challenges in the economy.
However, export performance remains stable, with November’s exports increasing by 1-point-4 percent year-on-year.
This marks the 14th consecutive month of positive growth.
The government emphasized that despite geopolitical risks, global economic recovery remains intact, but further uncertainties – particularly in trade environments – continue to pose challenges.
Moving forward, the government plans to maintain strong international credibility while reinforcing efforts to support economic stability and strengthen industrial competitiveness.
During an emergency economic meeting on Friday, finance authorities reported a conference call with three major international credit rating agencies to note the strong fundamentals of South Korea’s economy.
Moon Hye-ryeon, Arirang News.
source : https://www.arirang.com/news/view?id=278997
