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Escalating geopolitical risks may impact S. Korean economy: finance minister

All News 16:23 April 17, 2017

SEJONG, April 17 (Yonhap) -- Escalating geopolitical risks over North Korea will likely affect the South Korean economy which recently showed some signs of recovery, Seoul's finance minister said Monday, calling for tighter monitoring and a timely response to unexpected developments if the need arises.

"Tensions surrounding North Korea have been rising recently and the South Korean economy may be affected by it," Finance Minister Yoo Il-ho said in a weekly staff meeting. "We need to monitor the movements of North Korea and their impact on the economy, and take action in a timely manner."

Geopolitical risks have increased on Korean Peninsula amid speculation that Pyongyang may conduct its sixth nuclear test or launch an intercontinental ballistic missile around its key anniversaries in April.

He said the government should make more efforts to prevent such downside pressure from spreading into the real economy, which seems to have entered an upside cycle on the back of more global trade.

"The economy has been doing better than expected as rising exports led to recovery in production and investment," said the top economic policymaker. "But we will not let our guard down given internal and external risks including North Korea and other trade issues."

There has been concerns of rising protectionism in certain countries that can directly impact Asia's fourth-largest economy.

South Korea saw its exports gain ground for five months in a row since November last year on stellar overseas sales of semiconductors led by recovering world trade. The brisk overseas sales of chips led facility investment, which jumped 19.5 percent on-year in February and rose 10.7 percent in January.

South Korea's Finance Minister Yoo Il-ho (Yonhap file photo)


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