March 13, 2020 12:20
Global rating firm Standard & Poor's warned Korean businesses on Thursday of possible ratings downgrades due to the coronavirus pandemic.
S&P said Korea's "trade-dependent companies are emblematic of the strain COVID-19 is putting on global ratings."
The high or currently spiking number of coronavirus infections could mean that as volume of exports falls, its external and fiscal balance will suffer.
The firm estimated that about 23 percent of the 70 Korean companies under its credit ratings watch could be affected negatively. They include heavyweights such as Samsung and Hyundai, while firms "belonging to the refining and chemical, steel, airline, retail, auto, and technology sectors are all highly exposed."
The ratings agency projects Korea's economy to grow 1.1 percent this year, just half the growth projected before the coronavirus outbreak.
But S&P said the situation could improve starting in the second half of this year, forecasting that the pandemic will peak before June, while Korea's economy should rebound to 3.2 percent growth next year.
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