S. Korea's facility, construction investments slacken this year

SEOUL, Nov. 17 (Yonhap) -- The growth of South Korea's facility and construction
investments sharply slowed in the first nine months of this year as companies
became reluctant to expand capital spending amid the slowing economy, central
bank data showed Monday.

The country's facility and construction investments grew a mere 0.4 percent in
the January-September period from a year earlier, sharply slowing from a 4.4
percent expansion the previous year, according to data released by the Bank of
Korea.
The capital and construction investments expanded 15.2 percent on-year in the
first nine months of 2000, but they dipped 2.9 percent during the same period of
2001.
If this trend goes on, annual investment growth is likely to dip to negative
territory in 2008 for the first time since 2001 when such investments declined
0.5 percent, it said.
Economists say slackening investment is feared to deal a blow to
already-faltering domestic demand.
The South Korean economy grew 0.6 percent on-quarter in the third quarter, the
slowest growth in four years, due to faltering domestic demand and lagging export
growth.
Some builders, which borrowed mostly from savings banks during the housing market
boom, are suffering from financial burdens caused by the slowing economy and a
huge number of unsold homes, with some going out of business.
sooyeon@yna.co.kr
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