ID :
64419
Sat, 06/06/2009 - 15:21
Auther :
Shortlink :
https://oananews.org//node/64419
The shortlink copeid
S. Korean economy likely to recover very slowly: experts
SEOUL, June 5 (Yonhap) -- The heads of local think tanks said Friday that the
economic downturn may have passed the worst phase, but the pace of recovery is
likely to be slow due to widespread uncertainty.
Amid budding signs of economic improvement, cautious optimism has risen that the
local economy may be bottoming out. Business and consumer sentiment improved in
recent months, but facility investment and domestic demand still remained
sluggish amid a murky economic outlook.
"Even if the economy is improving, the pace of its recovery is likely to be
considerably slow," the Financial Services Commission, the financial regulator,
quoted chiefs of private and state think tanks as saying. "It would be difficult
to see rapid recovery in the short period of time."
The view is widely echoed by remarks by the Bank of Korea (BOK), which said it is
too early to say whether the Korean economy is bottoming out due to lingering
uncertainty.
Asia's fourth-largest economy grew 0.1 percent in last quarter from three months
earlier on the back of the government's fiscal spending and rate cuts.
The BOK said without aggressive fiscal spending, the country's GDP might decline
about 0.6 percent on-quarter and shrink around 5.4 percent on-year in the first
three months of this year.
Experts called for swift corporate restructuring, saying that a delay in such a
drive could hamper the economic recovery.
Local banks have been restructuring ailing companies, but they have come under
fire for being reluctant to carry out the efforts for fear that weeding out
troubled corporate clients could increase potential losses.
South Korea plans to tap 20 trillion won (US$16.1 billion) to buy bad debts and
purchase assets from ailing companies this year as part of efforts to brace for a
corporate revamp drive.
The money will come from an envisioned 40 trillion won fund which is designed to
help financial firms clean their balance sheets by buying distressed loans and
accelerate corporate restructuring.
sooyeon@yna.co.kr
(END)
economic downturn may have passed the worst phase, but the pace of recovery is
likely to be slow due to widespread uncertainty.
Amid budding signs of economic improvement, cautious optimism has risen that the
local economy may be bottoming out. Business and consumer sentiment improved in
recent months, but facility investment and domestic demand still remained
sluggish amid a murky economic outlook.
"Even if the economy is improving, the pace of its recovery is likely to be
considerably slow," the Financial Services Commission, the financial regulator,
quoted chiefs of private and state think tanks as saying. "It would be difficult
to see rapid recovery in the short period of time."
The view is widely echoed by remarks by the Bank of Korea (BOK), which said it is
too early to say whether the Korean economy is bottoming out due to lingering
uncertainty.
Asia's fourth-largest economy grew 0.1 percent in last quarter from three months
earlier on the back of the government's fiscal spending and rate cuts.
The BOK said without aggressive fiscal spending, the country's GDP might decline
about 0.6 percent on-quarter and shrink around 5.4 percent on-year in the first
three months of this year.
Experts called for swift corporate restructuring, saying that a delay in such a
drive could hamper the economic recovery.
Local banks have been restructuring ailing companies, but they have come under
fire for being reluctant to carry out the efforts for fear that weeding out
troubled corporate clients could increase potential losses.
South Korea plans to tap 20 trillion won (US$16.1 billion) to buy bad debts and
purchase assets from ailing companies this year as part of efforts to brace for a
corporate revamp drive.
The money will come from an envisioned 40 trillion won fund which is designed to
help financial firms clean their balance sheets by buying distressed loans and
accelerate corporate restructuring.
sooyeon@yna.co.kr
(END)
