Seoul, September 13, 2024 – South Korea’s Ministry of Economy and Finance released the September issue of its Green Book, titled Latest Economic Trends, indicating that the country’s domestic demand is showing signs of steady recovery, albeit at varying speeds across different sectors.
The Green Book, published by the South Korean Ministry of Planning and Finance, highlights that the Korean economy has continued to show signs of recovery, driven by strong exports and manufacturing. However, domestic demand has been on the rise, primarily due to increased investment in equipment and services.
The Green Book notes that the government has been consistently observing signs of recovery in domestic demand for the past five months. According to various indicators, the retail sales in July decreased by 2.1% year-on-year, while construction investment fell by 5.3%. Conversely, the production in the service sector and equipment investment increased by 2.2% and 18.5%, respectively.
Despite the overall positive trend, the Green Book also acknowledges the presence of several uncertainties in the global economic landscape. These include the ongoing Russia-Ukraine conflict, the escalating tensions in the Middle East, and the slowing economic growth in major countries.
The Green Book also emphasizes the importance of addressing these uncertainties to ensure a stable and sustainable economic recovery in South Korea. The report suggests that the government should focus on implementing policies that promote domestic demand and support the growth of key sectors, such as manufacturing and services.
To achieve this, the South Korean government may consider several measures, including:
- Fiscal Stimulus: The government could increase public spending on infrastructure projects and social welfare programs to boost domestic demand.
- Tax Incentives: Implementing tax incentives for businesses and consumers can encourage investment and consumption.
- Monetary Policy: The South Korean central bank could lower interest rates to make borrowing cheaper and stimulate economic activity.
- Trade Policies: Encouraging exports and diversifying trade partners can help the country overcome the challenges posed by global uncertainties.
The steady recovery in domestic demand is a positive sign for the South Korean economy, which has been struggling with the aftermath of the COVID-19 pandemic and the global economic downturn. However, the country needs to remain vigilant about the potential risks and challenges ahead.
As the Green Book points out, the economic recovery process is complex and multifaceted. It requires a coordinated effort from the government, businesses, and consumers to achieve sustainable growth.
In conclusion, the latest Green Book indicates that South Korea’s domestic demand is on the rise, providing a glimmer of hope for the country’s economic recovery. However, it is crucial for the government and other stakeholders to address the existing uncertainties and implement effective policies to ensure a stable and prosperous future for the Korean economy.
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