ID :
83759
Thu, 10/08/2009 - 21:33
Auther :
Shortlink :
https://www.oananews.org//node/83759
The shortlink copeid
S. Korea expected to pull off moderate economic recovery: think tank
SEOUL, Oct. 8 (Yonhap) -- South Korea's economic recovery is expected to be more
moderate despite signs of faster-than-expected gains in the short term, a
state-run think tank said Thursday.
The forecast by the Korea Institute for Industrial Economics and Trade (KIET) is
noteworthy as it comes amid upbeat expectations that this year's growth will
contract by less than 1 percent on-year and rebound to gain by more the 4
percent annually in 2010.
Originally local policymakers and international organizations expected the
country's economy to contract by 2-3 percent this year due to the worldwide
economic slump brought on by the collapse of Lehman Brothers in September 2008.
"Counting this year's crisis, South Korea has gone through similarly difficult
conditions five times so far, and while the economy is recovering, the pace of
recovery will be more moderate than before," the report claimed.
South Korea began to pull off solid gains in the 1960s, and experienced troubles
in 1972, 1975, 1980 and 1998 as it shook off non-viable companies, survived two
oil shocks and struggled to overcome the Asian financial crisis.
KIET said that in all past crisis situations, South Korea made a rapid comeback
as a result of favorable exchange rates and exports.
"Compared to the past, this year's troubles pose a new set of challenges since
the economic slump hit the entire world and caused trade volume to fall sharply
across the board, translating into less demand for South Korean goods," it said.
The institute, under the Ministry of Knowledge Economy, also said that while the
weak South Korea won has helped fuel exports, the positive effects have started
to wear off.
In the third quarter, the Korean currency averaged around 1,240 won to U.S.
dollar, but has strengthened since, reaching 1,167 won to the greenback at the
end of Thursday trading.
KIET, in addition, advised the government to be cautious about implementing a
so-called exit strategy that could hurt the economy.
South Korea's economic gains this year have been attributed to extensive stimulus
programs implemented by the government that includes 28.4 trillion won (US$24.3
billion) extra budget passed by parliament in late April.
Exit strategies would aim to cut back on expansionary state spending and
excessively low interest rates.
yonngong@yna.co.kr
(END)
moderate despite signs of faster-than-expected gains in the short term, a
state-run think tank said Thursday.
The forecast by the Korea Institute for Industrial Economics and Trade (KIET) is
noteworthy as it comes amid upbeat expectations that this year's growth will
contract by less than 1 percent on-year and rebound to gain by more the 4
percent annually in 2010.
Originally local policymakers and international organizations expected the
country's economy to contract by 2-3 percent this year due to the worldwide
economic slump brought on by the collapse of Lehman Brothers in September 2008.
"Counting this year's crisis, South Korea has gone through similarly difficult
conditions five times so far, and while the economy is recovering, the pace of
recovery will be more moderate than before," the report claimed.
South Korea began to pull off solid gains in the 1960s, and experienced troubles
in 1972, 1975, 1980 and 1998 as it shook off non-viable companies, survived two
oil shocks and struggled to overcome the Asian financial crisis.
KIET said that in all past crisis situations, South Korea made a rapid comeback
as a result of favorable exchange rates and exports.
"Compared to the past, this year's troubles pose a new set of challenges since
the economic slump hit the entire world and caused trade volume to fall sharply
across the board, translating into less demand for South Korean goods," it said.
The institute, under the Ministry of Knowledge Economy, also said that while the
weak South Korea won has helped fuel exports, the positive effects have started
to wear off.
In the third quarter, the Korean currency averaged around 1,240 won to U.S.
dollar, but has strengthened since, reaching 1,167 won to the greenback at the
end of Thursday trading.
KIET, in addition, advised the government to be cautious about implementing a
so-called exit strategy that could hurt the economy.
South Korea's economic gains this year have been attributed to extensive stimulus
programs implemented by the government that includes 28.4 trillion won (US$24.3
billion) extra budget passed by parliament in late April.
Exit strategies would aim to cut back on expansionary state spending and
excessively low interest rates.
yonngong@yna.co.kr
(END)
