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S. Korean economy remains sluggish on slowing exports: KDI

Industry 12:00 December 08, 2019

SEOUL, Dec. 8 (Yonhap) -- The South Korean economy shows a continued sluggishness due to slowing exports and weak investment, a state-run think tank said Sunday.

"The Korean economy remains subdued with a contraction in exports and investment despite the improvements in a few sentiment indices," the Korea Development Institute (KDI) said in its English-language Monthly Economic Trends publication.

South Korea's exports fell 14.3 percent on-year to US$44.1 billion in November, extending their on-year decline for a 12th consecutive month amid the protracted trade row between the United States and China, and an extended slump in chip prices.

Exports of semiconductors fell 30.8 percent to $7.39 billion, dealing a blow to South Korea, where semiconductors account for one-fifth of outbound shipments.

South Korea -- home to Samsung Electronics Co., the world's largest memory chip maker, and its smaller rival SK hynix Inc. -- accounted for more than 60 percent of the global memory market in 2018.

Adding to the economy's woes, facility investment stayed on a downward trajectory, exacerbating the sluggishness in overall investment.

The KDI said the cyclical component of the leading composite index and the economic sentiment index improved slightly, suggesting that the economy is unlikely to experience further deterioration.

The South Korean economy expanded 0.4 percent from three months earlier in the third quarter, as earlier estimated, the Bank of Korea said earlier this month.

The central bank has recently cut its growth outlook for Asia's fourth-largest economy to 2 percent this year from its previous forecast of 2.2 percent in July.

This file photo shows the Korea Development Institute's headquarters in Sejong, an administrative hub about 130 kilometers southeast of Seoul. (Yonhap)


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