Korea's households save more despite record low interest rates

South Korean households are continuing to set aside more cash than before, data showed Monday, even though they can now expect less interest on their savings with the base rate staying at a record low.According to data from the government and the Bank of Korea, the net savings rate for households came to 6.1 percent in 2014, up 1.2 percentage points from the previous year.The net savings rate represents the ratio of money set aside by households from their total disposable income. The rate had b

Oct. 26, 2015

Over 20% of chaebol units found to be 'zombie firms'

More than 20 percent of South Korean conglomerates' affiliates were found to be unprofitable and highly indebted last year, market data showed Monday, a revelation that comes amid the government's push to prevent any fallout on the economy from their sudden collapse.The number of "zombie companies," which can't generate enough operating profit to pay taxes and interest payments or require constant bailouts, reached 236, or 22.5 percent, of the 1,050 affiliated companies of the top 30 business gr

Oct. 26, 2015

Korea's growth forecast to dip to 2% range in 2016

Global economic think tanks and investment banks are predicting South Korea's growth to slide to the upper 2 percent range in 2016 due to slumping exports and weak domestic demand, financial market sources said Monday.The latest monthly Consensus Economic report showed overseas think tanks and IBs expect Asia's fourth-largest economy to grow at an average rate of 2.9 percent next year, down from a 3.2 percent estimate forecast in September. The average growth projection is lower than the 3.3 per

Oct. 26, 2015

Korean housing permits soar in Sept.

Construction permits issued for new homes surged more than two-fold in September to the year before, the government said Sunday, a strong sign of recovery in the country's real estate market.The number of new home permits issued came to 87,955 units last month, up 133.1 percent from 37,726 from the year earlier, according to the Ministry of Land, Infrastructure and Transport.September marked the ninth consecutive month of on-year increase, with the pace accelerating from a 41.2 percent spike tal

Oct. 25, 2015

Number of Korean visitors to Japan hits record high

The number of South Korean tourists to Japan has hit an all-time high this year as the yen's continued weakness makes travel to the neighboring country cheaper, industry data showed Sunday.A total of 2.86 million South Koreans visited Japan in the first nine months of the year, up a whopping 43.1 percent from the same period a year earlier, according to the data by the state-run Korea Tourism Organization.The tally already has surpassed the previous full-year record of 2.6 million set in 2007.In

Oct. 25, 2015

South Korea's economy expands at fastest clip in 3 quarters

South Korea's economy expanded 2.6 percent in the July-September quarter from a year earlier, the fastest annual clip in three quarters, the Bank of Korea said Friday, showing a recovery from the Middle Eastern respiratory syndrome crisis that gripped the country in the summer.The result was better than expected. Asia's fourth-largest economy took a hit after a deadly outbreak of MERS in the country, prompting tourists to cancel trips and keeping local residents away from shopping malls and conc

Oct. 23, 2015

Seoul shares up 1.38 pct in late-morning trade

South Korean stocks traded 1.38 percent higher late Friday morning on hopes for additional stimulus measures by the European Central Bank (ECB) and better-than-expected domestic growth data. The benchmark Korea Composite Stock Price Index (KOSPI) vaulted 26.79 points to 2,049.79 as of 11:20 a.m.Stocks across the board rose after ECB chief Mario Draghi said Thursday that the bank will consider bolstering its bond-buying program this year, sending European and U.S. stocks higher.SK Innovation, the

Oct. 23, 2015

Korea's economic growth hits 5-year high in Q3

South Korea's economic growth reached a five-year high in the third quarter thanks to a strong rebound in domestic demand, central bank data showed Friday.The economy grew 1.2 percent on-quarter in the July-September period, the first time in five quarters that growth exceeded the 1 percent mark, according to the preliminary data by the Bank of Korea.This is the highest reading since 1.7 percent growth tallied in the second quarter of 2010.Consumer spending has rebounded as the impact of the Mid

Oct. 23, 2015

Korea's terms of trade improve in Sept.

Despite a prolonged decline in exports, South Korea's terms of trade continued to improve in September as import prices shrank at a faster rate than export prices, central bank data showed Thursday.The country's terms-of-trade index for products soared to 101.63 in September, up 12.5 percent from the same month last year, according to the preliminary data from the Bank of Korea (BOK).The index gauges the amount of imports a country can purchase for each unit of its exports, which shows how the c

Oct. 22, 2015

Korea mulls best way to impose taxes on clergy

South Korean legislators and policymakers are trying to devise the best possible way to impose taxes on the clergy, which has been a sensitive issue for years, official sources said Thursday.The government has reaffirmed on numerous occasions that there should be no exceptions when it comes to paying dues and the matter should be viewed as establishing fair taxation. Despite this stance, it has also backed down under pressure or opted to delay making a decision that could cause a backlash.In its

Oct. 22, 2015

Korea ahead U.S. in innovation-ridden growth: TechShop founder

Jim Newton, the founder of membership-based startup supporter TechShop Inc., said Wednesday that South Korea stays ahead of the United States in its acknowledgement of innovations, expecting the country's creative economy policy to serve as a new growth engine."We do not have anything like that in the U.S. They do not have the vision," Newton said during an interview, referring to the country's state-led start-up incubator center.U.S.-based TechShop provides startups and individuals with high-en

Oct. 21, 2015

Stagnant service sector leads to youth unemployment: think tank

Stagnant growth of South Korea's service sector is contributing to the country's high jobless rate among young people, a state think tank said Wednesday, calling for measures to galvanize the industry.To help solve the problem, there is a pressing need to build up the country's service sector in such areas as logistics, finance and insurance, education, health care, tourism, contents creation and software development, the Korea Development Institute said in a related forum."The service sector is

Oct. 21, 2015

Labor reform crucial for long-term growth: finance minister

The reform of South Korea's labor market is critical for long-term economic growth and can expand employment opportunities that benefit all sectors of society, the top economic policymaker said Wednesday.Speaking at a job fair in Gwangju, 330 kilometers south of Seoul, Finance Minister Choi Kyung-hwan expressed concern that despite an agreement reached at the tripartite talks in September, conflicts of interest and divergent political agendas have prevented follow-up legislation from gaining spe

Oct. 21, 2015

Korea set to tackle rising 'zombie companies'

The number of "zombie companies" in South Korea has risen sharply over the past five years, data showed Wednesday, with the financial authorities set to take preemptive action to tackle any impact from their sudden collapse.The number of zombie companies, which do not generate enough operating profit to pay tax and interest payments or require constant bailouts, stood at 3,295 as of end-2014, up from 2,698 in 2009, according to the data compiled by the Bank of Korea.The percentage of such troubl

Oct. 21, 2015

Gov't to hew to fiscal expansion for economic growth

The government plans to strictly adhere to its expansionary fiscal spending plan to help prop up the growth of its economy struggling with sagging exports and weak consumption, the finance ministry said Tuesday.In a meeting to review fiscal spending progress, government officials said every effort will be made to follow through on expenditure programs in the fourth quarter and to minimize the amount of unused taxpayers' money.The ministry predicted Asia's fourth-largest economy will grow just 3.

Oct. 20, 2015

60 % of public firms adopt wage peak system

Slightly over 60 percent of public corporations and organizations have adopted the wage peak system as the government pushes for broad social and labor reforms, the finance ministry said Tuesday.Out of the 316 public sector corporations, 191, or 60.4 percent, had reached an understanding with workers to introduce the novel wage system as of Monday, according to the ministry.Thirty-four other public organizations plan to hold board of directors meetings within the month to approve the wage peak s

Oct. 20, 2015

Half of major conglomerates to adopt wage peak system

About half of South Korean major conglomerates have decided to adopt a wage peak system from next year as the Seoul government pushes to reform the country's rigid labor market, a survey showed Tuesday.Eleven conglomerates including Samsung Group, LG Group, Lotte Group and POSCO Group will embrace the new type of remuneration at all affiliated companies starting from the beginning of 2016, according to the poll of 21 large businesses conducted by the Korean Federation of Korean Industries.Anothe

Oct. 20, 2015

U.S. Treasury: Korea's foreign exchange intervention pattern 'balanced'

South Korea has continued to intervene in foreign exchange markets this year, but the pattern of intervention with respect to depreciation and appreciation "appears roughly balanced," the U.S. Treasury Department said Monday.The department made the assessment in its Report to Congress on International Economic and Exchange Rate Policies, saying the won depreciated by 7.7 percent against the dollar, and 2.0 percent on a real trade-weighted basis, in the year through September."Treasury estimates

Oct. 20, 2015