Hyundai Research Institute cuts South Korea's economic growth projection for 2019 from 2.6% to 2.5%
- 5 years ago
A local think tank has downgraded its growth projection for the South Korean economy in 2019... pointing to the slowing global economy and sluggish domestic demand... as some of the reasons behind its decision.
Ko Roon-hee reports.
The Hyundai Research Institute has cut South Korea's growth forecast for 2019 to two-point-five percent.
This is down from the previous forecast of two-point-six percent announced in September.
It's the lowest projection yet among other major organizations, including the OECD's outlook of two-point-eight percent and the Bank of Korea's two-point-seven percent.
According to the institute's report released on Sunday, the main reasons for the downgraded outlook were the global economic slowdown and fears over low domestic demand.
The global economic slowdown will affect the increase rate of South Korean exports.
Outbound shipments are likely to increase by three-point-seven percent in 2019,... sharply down from this year's estimate of six-point-two percent.
One reason is the trade war between the U.S. and China.
Although the leaders of the world's biggest economies reached a deal to temporarily keep their countries' trade tensions from escalating earlier this month, there are still risks...because U.S. tariffs on 200-billion U.S. dollars worth of Chinese goods can go up after 90 days.
Either way, the trade war can negatively affect South Korea as well, because many local companies rely on exports to China and the U.S.
Another reason is that the global semiconductor market is losing steam.
According to data from World Semiconductor Trade Statistics in November, the growth rate of the global semiconductor market will mark two-point-six percent next year... far lower than this year's estimate of almost 16 percent.
The institute also pointed to reasons closer to home.
Private consumption is expected to increase by 2-point-4 percent next year, down from this year's estimate of 2-point-7 percent.
This is mainly due to low consumer sentiment coming from a decrease in newly-added jobs and an increase in the unemployment rate.
Facilities investment, on the other hand, is expected to edge up zero-point-four percent, up from this year's estimate of negative growth...due to the government's push for innovative growth.
Ko Roon-hee, Arirang News.
Ko Roon-hee reports.
The Hyundai Research Institute has cut South Korea's growth forecast for 2019 to two-point-five percent.
This is down from the previous forecast of two-point-six percent announced in September.
It's the lowest projection yet among other major organizations, including the OECD's outlook of two-point-eight percent and the Bank of Korea's two-point-seven percent.
According to the institute's report released on Sunday, the main reasons for the downgraded outlook were the global economic slowdown and fears over low domestic demand.
The global economic slowdown will affect the increase rate of South Korean exports.
Outbound shipments are likely to increase by three-point-seven percent in 2019,... sharply down from this year's estimate of six-point-two percent.
One reason is the trade war between the U.S. and China.
Although the leaders of the world's biggest economies reached a deal to temporarily keep their countries' trade tensions from escalating earlier this month, there are still risks...because U.S. tariffs on 200-billion U.S. dollars worth of Chinese goods can go up after 90 days.
Either way, the trade war can negatively affect South Korea as well, because many local companies rely on exports to China and the U.S.
Another reason is that the global semiconductor market is losing steam.
According to data from World Semiconductor Trade Statistics in November, the growth rate of the global semiconductor market will mark two-point-six percent next year... far lower than this year's estimate of almost 16 percent.
The institute also pointed to reasons closer to home.
Private consumption is expected to increase by 2-point-4 percent next year, down from this year's estimate of 2-point-7 percent.
This is mainly due to low consumer sentiment coming from a decrease in newly-added jobs and an increase in the unemployment rate.
Facilities investment, on the other hand, is expected to edge up zero-point-four percent, up from this year's estimate of negative growth...due to the government's push for innovative growth.
Ko Roon-hee, Arirang News.