Korea needs more investment to boost service industry: report

By Kim Soo-yeon
SEOUL, Sept. 7 (Yonhap) -- South Korea's service industry remained less
competitive than those of major advanced countries, a central bank report showed
Monday, calling for more investment to boost the sector.

South Korea's service sector accounted for 40.4 percent of the total economy in
2007, up from 39.3 percent in 2000, according to the Bank of Korea (BOK). The
figure compares with 70 percent for the United States, 66.9 percent for Britain
and 55 percent for Japan, it added.
"The weight of South Korea's service sector out of the overall economy has
increased, but still fell short of levels seen in major advanced countries, while
the international competitiveness of the Korean service industry also remains
low," the central bank said in a statement.
The report said value generated by the local service industry was low mainly
because the weight of so-called producer services, including broadcasting,
finance and real estate, remained small.
South Korea posted a service account deficit of US$16.7 billion in 2008, sharply
up from $3 billion in 1995, led by increased spending on overseas studies and
travel and payments on patent rights, the report showed.
"To boost sustainable growth and job creation, the country needs to nurture the
service industry as a new growth engine," it said, adding that Korea should make
efforts to beef up the producer service sector which is closely connected with
the manufacturing industry.
The central bank also said the country should make more investments in the travel
industry and expand a set of policy support measures for the service industry.
sooyeon@yna.co.kr
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