August 09, 2019 12:22
An export decline since May resulting from the U.S.-China trade war is reminiscent of the 2008 global financial crisis and bursting of the tech bubble in the early 2000s, experts warn.
The Bank of Korea in a report on Thursday analyzed the impact of the U.S.-China trade war on Korea's economy. It said the sharp decline in exports has a "high correlation" with the intensifying trade spat.
Korea's exports from January to April this year fell an average of 6.9 percent a month, but in May they plunged 9.7 percent and in June 13.7 percent.
The BOK said the U.S.-China trade war "heightened uncertainties" in the global economy and trade and was one of the main causes for the decline. The central bank spotted a similar pattern to the bursting of the dotcom bubble in the early 2000s and global financial crisis in 2008.
Global stock markets plunged when the dotcom bubble burst, resulting in falling exports for Korea. During the 2008 global financial crisis, Korea's exports also plummeted.
The BOK said it is necessary to "keep a close watch" on fluctuations in global trade and the impact on the domestic economy.
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