June 19, 2019 11:46
Global rating firm Fitch has slashed Korea's economic growth forecast for this year from 2.5 to two percent.
The revised outlook is even lower than the 2.1-percent projection by Moody's.
Fitch released its latest global outlook report on Tuesday and said Korea's economy shrank 0.4 percent in the first quarter, the biggest decline since the 2008 global financial crisis.
"Korean exports have been under pressure since the second half of 2018, affected by the slowdown in China and rising trade frictions, which exacerbated the cyclical downturn in the memory chip sector," it said.
Fitch also pointed an accusing finger at government policies that have dampened business sentiment. Fitch said the sharp minimum-wage hike over the last two years had a negative impact on corporate profitability, while reducing appetite for investment.
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