Moon Upbeat About Economy Despite Deepening Slump

  • By Jeong Woo-sang, Choi Kyu-min

    April 30, 2019 09:57

    Moon Jae-in

    President Moon Jae-in on Monday again claimed that Korea's economic fundamentals are "solid" and that his government was maintaining stable control over inflation, unemployment and foreign currency reserves.

    Moon's comments in a meeting of senior Cheong Wa Dae secretaries came as figures pointed to the worst slump in a decade. The economy contracted 0.3 percent from the previous quarter, with capital investment falling 10.8 percent and exports 2.6 percent.

    "The economy will overcome the sluggishness of the first quarter and gradually begin to recover and improve from the second quarter," he said.

    He blamed outside forces for the malaise and said, "External conditions, including a slowing global economy, deteriorated faster than expected and emerged as a threat to our export-driven economy." He stressed the importance of fiscal pump-priming and said, "Fiscal health is extremely robust compared to other OECD member nations and there is room for expanded government spending."

    Yet the latest data show the country ranked 18th in terms of GDP growth among 36 member nations of the OECD last year, the worst standing since the 1998 Asian financial crisis.

    Korea's economy grew 2.7 percent in 2018, falling behind Ireland (6.7 percent), Poland (5.1 percent), Hungary (4.9 percent), Israel (3.3 percent), the U.S. (2.9 percent) and New Zealand (2.8 percent).

    But Korea may not even grow 2.5 percent this year, and macroeconomic data like youth unemployment paint an even bleaker picture. 

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