Korean economy on modest recovery track – 7 May 2017

  • The South Korean economy has been showing some modest signs of recovery thanks to brisk exports and investment but the momentum remains weak due to flaccid private consumption, a state-run think tank said 7 May 17.
  • Asia’s fourth-largest economy saw its outbound shipments jump to a nearly seven-year high of 24.2% in Apr 17, extending their winning streak to six months.
  • The upswing was led by a 102 percent on-year surge in exports of ships and a 56.9% rise in overseas sales of semiconductors.
  • The KDI report said such improvement in exports is partially attributable to the recovery of the global economy, while the Seoul government revised up its exports growth forecast for 2017 to as high as 7% from its earlier plan of 2.9%.
  • Facility investment was also strong recently, largely led by the stellar sales of chips, as the equipment investment index rose 22.8% on-year in Mar 17.
  • Mar 17’s all industry production grew 4% from 2016, with a 3% gain in the mining and manufacturing sector, down from a 6% rise in Feb 17. The manufacturing capacity utilization rate edged up to 72.6% in Mar 17 from 71% in Feb 17.
  • The upbeat pace in the production and exports sides was, however, offset by sluggish private consumption.
  • Retail sales climbed 1.6% in Mar 17, slightly up from 0.5% in Feb 17, with the seasonally adjusted growth staying unchanged from a month earlier.
  • Wholesale and retail trade moved up 0.7%, while accommodation and food services retreated 3.6% to continue the downward slide since 2H16.
  • But the KDI said composite consumer sentiment index hit 101.2 in Apr 17, up from Mar 17’s 96.7, marking the highest reached since Oct 16 when it stood at 102, on growing positive sentiments about economic conditions.

External Link : http://www.koreaherald.com/view.php?ud=20170507000197