S. Korea's industrial output sinks 10.3 pct in Feb.

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SEOUL, March 31 (Yonhap) -- South Korea's industrial output continued its
double-digit contraction for a fourth straight month in February as demand for
semiconductors and automobiles declined due to a deepening global recession, a
government report showed Tuesday.
According to the report by the National Statistical Office (NSO), production in
the mining and manufacturing sectors shrank 10.3 percent last month from a year
earlier, compared with a revised 25.5 percent on-year decline in January.
The February data marked the fourth consecutive month of double-digit contraction
but was better than a median estimate of a 14.7 percent decline in a poll
conducted by Yonhap Infomax, the financial news arm of Yonhap News Agency.
"The output figure shows that our economy still remains in a slump," said Jeon
Min-kyu, an analyst at Korea Investment & Securities. "But the contraction rate
is markedly slowing, indicating that the economy seems to be rebounding."
Compared with a month earlier, production jumped 6.8 percent in February,
continuing its month-to-month growth after posting a 1.6 percent advance in
January.
The February data is the latest indicator that raises optimism that the economy,
Asia's fourth-largest, might be gaining some momentum for a turnaround from what
could be the worst downturn in more than a decade.
On Monday, the Bank of Korea said that the nation's account surplus reached
US$3.68 billion in February, a turnaround from a $1.64 billion deficit the
previous month. The February figure marked the largest surplus since October 2008
and the central bank forecast the surplus will grow to $5 billion this month.
Business sentiment improved as more companies expressed optimism over eased woes
in the financial market and the expected effects of the government's stimulus
package. The business survey index of manufacturers' expectations rose to 60 for
April from 50 in March.
South Korea's economy may begin to make a rebound in the second half of this
year, Hyun Oh-seok, the head of the state-run think tank Korea Development
Institute said in a recent interview. He added that the economy is currently
"accumulating energy" before staging a turnaround.
There are still "many challenges" lying ahead for the nation's economy such as
higher unemployment, sluggish domestic demand and investment, Finance Minister
Yoon Jeung-hyun told a government meeting on Monday.
He emphasized the need for the government to play a bigger role in getting the
economy back on track.
The nation's jobless rate jumped to a four-year high of 3.9 percent in February
with over 140,000 jobs eliminated from payrolls compared with a year earlier. The
job loss is the steepest since September 2003.
The government is stepping up its efforts to revive the economy. Last week, it
endorsed a record 28.9-trillion won extra budget aimed at creating jobs and
reviving the economy feared to slip into the first recession in more than a
decade.
South Korea's economy grew 2.2 percent last year but the government forecast a 2
percent contraction for this year, with a total of 200,000 jobs to be lost from
payrolls.
kokobj@yna.co.kr
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