December 03, 2019 13:51
Korea's economy is in the worst shape in 50 years as exports are hit by the protracted U.S.-China trade dispute and slumping semiconductor industry, the Financial Times claimed Monday.
"The [Korean] economy is on track for one of its worst two-year growth periods in more than half a century, battered by China's economic slowdown," the daily said.
The Bank of Korea last month slashed the growth forecast for this year to two percent, down from 2.6 percent projected early this year. It also lowered its forecast for next year from 2.5 to 2.3 percent.
"According to central bank records dating back to 1954, there has been no consecutive two-year period with growth lower than 2.5 percent," the FT said.
In 2009, just after the global financial crisis erupted, Korea's economic growth slowed to 0.8 percent but rebounded to 6.8 percent the following year. In 1998 just after the Asian financial crisis, Korea's economy shrank 5.5 percent, only to surge 11.3 percent the next year and 8.9 percent in 2000.
"The fate of Asia's fourth-largest economy is closely tied to global electronics demand and China, with exports representing 45 percent of the country's GDP and China accounting for a quarter of the country's outbound shipments," the daily added.
The BOK has kept the base interest rate at a record-low 1.25 percent, while the government continues to maintain the most expansionary fiscal policy stance.
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