Finance minister nominee grilled over economic values

At a parliamentary hearing Wednesday, Kim Dong-yeon, nominee for deputy prime minister and finance minister, was under intense scrutiny over his stance that opposition lawmakers claimed would clash with the Moon Jae-in administration’s push for stronger welfare and income-led economic growth. The nominee, who mostly responded with theoretical answers, had served the former conservative Lee Myung-bak administration. He was presidential secretary for economy and finance from 2008-2009, the F

June 7, 2017

Minimum wage hike plan raises concerns

The new government’s push for a steep increase in the minimum wage has raised concerns that job opportunities for low-income, low-skilled workers will decrease as many small companies and self-employed businesses are forced to close or cut the number of employees.Under a plan announced by a presidential committee on jobs last week, Korea’s hourly minimum wage, which is currently pegged at 6,470 won ($5.80), is set to rise by an annual average of 15.7 percent over the next three years

June 7, 2017

Real income growth outpaced by economic expansion: data

The growth of real income of South Koreans has risen at a slower pace than that of economic growth over the past five years, government data showed Wednesday.The average real income of local businesses with at least five employees was 3.39 million ($3,000) per month last year, up 2.8 percent from a year earlier, according to the data by the Ministry of Strategy and Finance and the Ministry of Employment and Labor. It is on par with the country's real gross domestic product growth that stood at 2

June 7, 2017

Moon's job committee vows to raise minimum wage early

The new presidential committee on job creation is set to hold a series of meetings this week with business lobbies representing small and medium-sized enterprises, partly to learn their views on raising the minimum wage, the committee said Tuesday.Starting Thursday, committee officials will meet with representatives from the Korea Federation of Micro Enterprise, Korea Federation of SMEs and many others. The meetings are largely aimed at listening to possible difficulties that small businesses ma

June 6, 2017

Korea’s middle class declines as income distribution worsens

Amid increasing income disparity, the Ministry of Strategy and Finance said Tuesday that Korea’s middle class accounted for 65.7 percent of the population last year, a 1.7 percentage point decrease compared to the previous year. Although there is no established international standard in defining the middle class, Korea’s National Statistical Office defines the middle class as 50 to 150 percent of the country’s median income, in accordance to the standards of the Organization fo

June 6, 2017

Stricter lending rules looming amid rising home prices

With loosened lending rules expiring at the end of July, the new liberal Moon Jae-in government is reviewing whether to tighten them again, amid persistently rising home prices in Seoul.In August 2014, the Park Geun-hye administration allowed households to easily borrow money by raising the cap ratios of debt-to-income and loan-to-value to 60 percent and 70 percent, from 50-60 percent, respectively. The deregulatory moves, blamed for snowballing household debt and real estate speculation in sout

June 6, 2017

Despite strong exports, current account surplus slips

Despite strong exports, South Korea’s current account balance slid to $4 billion in April this year, recording the smallest surplus in the past year, according to the Bank of Korea on Monday. 　Bank of Korea announced the current account balance had continued a surplus for 62 consecutive months, but the growth in exports was offset by higher dividend payouts to foreigner investors, surging oil prices and other factors, which contributed to the current account surplus decreasing dramatically

June 5, 2017

THAAD issue may affect talks on Seoul-Beijing currency swap deal: BOK

South Korea's diplomatic tensions with China may weigh heavily on their upcoming talks on extending the bilateral currency swap deal, South Korea's central bank said Monday.China has taken a series of economic retaliations against South Korea, including a ban on group tours to South Korea, in protest of the deployment of an advanced US missile defense system in South Korea.Some South Koreans are concerned that the diplomatic tensions could jeopardize the currency swap agreement, although Beijing

June 5, 2017

Korea has room for tax hike: finance minister nominee

South Korea has some room for a tax hike in the future, the finance minister nominee said Monday, lending support to the government's expansionary fiscal policies to create jobs and boost the economy."South Korea can afford a tax increase, as it has a lower ratio of tax burden to the gross domestic product than other member countries of the Organization for Economic Cooperation and Development," incoming Finance Minister Kim Dong-yeon said in a report submitted to the parliament before

June 5, 2017

Moon takes action for income-led growth in Korean economy

South Korea on Monday started a full-fledged step to realize its slogan of the "income-led growth" through an 11.2 trillion-won ($9.99 billion) supplementary budget.The budget proposal -- which came less than one month after President Moon Jae-in took office -- is aimed at helping the needy get jobs and higher income. Moon has vowed to put his policy priority on creating jobs, especially for young people.Moon's "income-led growth" principle is similar to the concept of inclus

June 5, 2017

Korea outlines W11.2tr extra budget plan to create jobs

SEJONG -- South Korea on Monday outlined an 11.2 trillion-won ($9.99 billion) extra budget plan to create jobs and fuel the recent recovery momentum in the economy.The supplementary budget -- the first since President Moon Jae-in took office last month -- was approved at a Cabinet meeting. The budget proposal, just a fraction of the 400 trillion-won state budget for fiscal 2017, is set to be submitted to the National Assembly on Wednesday for approval. The extra budget is a follow-up to Moo

June 5, 2017

Korea's current account surplus rises to $4 bln in April

South Korea's current account surplus rose slightly in April from a year earlier on an increased surplus in the goods account, central bank data showed Monday.The country's current account surplus reached $4 billion in April, compared with a surplus of $3.76 billion tallied a year ago, according to the preliminary data from the Bank of Korea. The figure represents a surplus for 62 months in a row. The current account is the biggest measure of cross-border trade.The BOK said the goods account sur

June 5, 2017

Korea's FX reserves hit record high in May

South Korea's foreign exchange reserves hit a record high in May due to a hike in the value of non-dollar currencies when converted into the US greenback, central bank data showed Monday.As of the end of May, the country's foreign exchange reserves came to $378.46 billion, up $1.89 billion from the previous month, the Bank of Korea said in a statement.Foreign exchange reserves consist of securities and deposits denominated in overseas currencies, as well as International Monetary Fund reserve po

June 5, 2017

Extra budget on job creation meant to reduce inequality: Moon aide

President Moon Jae-in’s chief secretary for economic policies said Sunday that the government’s planned 10 trillion won ($9 billion) supplementary budget would help reduce inequality.Jang Ha-sung, the chief presidential secretary for economic policies, called the budget a “timely and effective” tool to resolve South Korea’s deepening economic polarization, stressing that the nation’s export-driven growth had failed to create more jobs.

June 4, 2017

Korea-ASEAN FTA accounts for 5 percent FDI after 10 years

With this year marking Korea‘s 10th anniversary since the country entered into the free trade agreement with the Association of Southeast Asian Nations, South Korea‘s investment among ASEAN accounts for only five percent of total foreign direct investments, according to a recent report by EY Rediscover ASEAN.As a global accounting and consulting firm, EY Rediscover ASEAN’s report found that Korea’s investment in Southeast Asian member nations accounted for five percent of

June 4, 2017

KORUS FTA cancellation to hurt US firms more than Korean counterparts: KIET

The cancellation of the free trade agreement between Seoul and Washington will be more detrimental to US companies than their South Korean counterparts, a local think tank said Sunday.According to the Korea Institute for Industrial Economics and Trade, if the South Korea-US pact is nullified by the Donald Trump administration, American companies that ship goods to South Korea will be required to pay more import duties, while local companies will be affected less. "If the two-way FTA is scra

June 4, 2017

Korea's economic structure remains fragile: think tanks

South Korea's latest economic gains do not indicate that the country's financial condition is on a firm track, as the increases can be attributed to investment in the construction sector and not improvements in private consumption, a research showed Sunday.Hyundai Research Institute said in a report that South Korea's economic growth depends excessively on construction, while private consumption, which takes up 50 percent of the country's gross domestic product, only had a limited impact on the

June 4, 2017

SMEs struggling with difficult conditions, has high hopes for new govt.

South Korea's small and medium enterprises have high hopes for the new Moon Jae-in administration as they struggle with difficult times, industry sources said Sunday.The Korea Federation of Small and Medium Business, or K-Biz, said its Chairman Park Sung-taek met with 25 regional SME business representatives in Yeosu, 455 kilometers south of Seoul, and exchanged views on the state of the regional economy.  "Business leaders said at the gathering on Saturday that while export figures we

June 4, 2017

Q1 GDP growth revised up to 1.1 percent

South Korea’s gross domestic product grew faster than expected in the first three months of this year, mainly due to stronger construction and exports, the Bank of Korea said Friday.Asia’s fourth-largest economy grew 1.1 percent in the first quarter from the previous quarter, the central bank said, updating seasonally-adjusted data from the previous estimate of 0.9 percent.The 1.1 percent quarterly growth was the fastest in six quarters, driven mainly by the private sector, not the g

June 2, 2017

Half of top 30 groups trim workforces in 2016

Nearly half of South Korea's top 30 family-controlled conglomerates slashed their workforces in 2016 from a year earlier, data showed Friday, amid unfavorable market conditions at home and abroad.The combined workforce of the 30 leading business groups came to 1,305,939 as of the end of last year, down 1.1 percent, or 15,069, from a year earlier, according to the data from market tracker Chaebul.com.Of the total conglomerates known as chaebol here, Samsung, Hyundai Heavy Industries, POSCO, LG an

June 2, 2017