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Lee Kyung-min

Korea Times AI content 2 team Reporter

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Economy

Financial stability top priority for 4 financial heads

Deputy Prime Minister and Finance Minister Hong Nam-ki / Korea Times fileBy Lee Kyung-min The government will closely monitor credit risks amplified by the COVID-19 pandemic-induced heavy borrowing this year, in a preemptive move to strengthen financial stability, certain to deteriorate amid the growing insolvency threat facing vulnerable income groups and industries, the four heads of the financial and monetary authorities said Tuesday in their respective New Year addresses.The collective resolve seeks to place greater emphasis on the need in recent years to bring excessive borrowing under control, as illustrated by the recent tightening of monetary easing and lending rules in an inevitable step for an economy showing slow yet clear signs of recovery.Most borrowers will be able to repay their debts, but the country's recovery will be only as strong as low-income earners and small businesses, whose livelihoods have been in tatters since the beginning of the pandemic, they said.The need to bolster financial stability will be stressed throughout the year, a critical step to navigating

Jan 4, 2022By Lee Kyung-min
Financial stability top priority for 4 financial heads
Economy

Surging commodity prices pose biggest threat to Korean firms

Getty Images Bank By Lee Kyung-min A sharp rise in global oil prices and the subsequent spike in energy costs will be the biggest threat to export-reliant Korea, as implied by the country's trade balance registering a deficit last month despite record-breaking export volumes over the past year.Korea registered a trade deficit of $590 million (702 billion won) in December, its first in 20 months, according to data from the Ministry of Trade, Industry and Energy. This was the result of a 37.4 percent year-on-year increase in imports offsetting an 18.3 percent year-on-year rise in exports. The last trade deficit in the amount of $950 million was logged in April 2020, at the beginning of the COVID-19 pandemic. Other than the health crisis-sparked deficit two years ago, Korea has registered trade surpluses every month since 2008 when the global financial crisis hit the economy. Businesses say corporate profitability will be hurt significantly by commodity price volatil

Jan 3, 2022By Lee Kyung-min
Surging commodity prices pose biggest threat to Korean firms
Economy

Korea expected to see high inflation level continue in 2022

A woman walks by a greengrocer in a traditional market in Seoul, Dec. 5. Korea Times file Finance ministry to strengthen risk management By Lee Kyung-min Korea has registered 2.5 percent annual headline consumer price inflation in 2021, which is the highest in 10 years, elevating anticipation over the timing and number of the central bank's key rate hikes, the most broad-based policy measure used to bring under control the faster-than-expected increase in goods and services prices. The 2.5 percent inflation measured by Statistics Korea is an addition of 1 percentage point from the 2.4 percent the government had expected, and has not veered off too much from the previous projections. Korea is forecast to register high inflation early next year, as evidenced by the year-on-year figure exceeding the psychologically significant 3 percent for the three consecutive months since October. Further strengthening such expectation is soaring commodities prices notably crude

Dec 31, 2021By Lee Kyung-min
Korea expected to see high inflation level continue in 2022
Economy

Omicron, climate change factors weighing on crypto market

gettyimagesbankBy Lee Kyung-min The cryptocurrency market is undergoing significant adjustments, rapidly weakening investor sentiment that has remained largely undeterred over the past few years amid the lack of regulations and cheap liquidity pumped in to weather the COVID-19 pandemic. The future course of the digital financial investment vehicle will be determined by how heavy the regulations become, a factor equally critical to the performance of the asset, the capital gains tax on which has been delayed for another year.Some say it remains unclear whether Bitcoin, one of major cryptocurrencies, will be able to withstand the slew of changes in the macroeconomic market conditions unfavorable to investors, notably the end of tapering by the U.S. Federal Reserve and subsequent rate hikes next year. Others say that high price volatility could become extreme at times, but that the overall uptrend will not be wildly upended, an assessment reflecting the continued increase in the number of highly risk-averse institutional investors, whose behavior is almost exclusively governed by the gu

Dec 31, 2021By Lee Kyung-min
Omicron, climate change factors weighing on crypto market
Economy

Industrial output surge offers mixed hopes of recovery

Tightening consumption feared to sap production vitality By Lee Kyung-min The Korean economy showed strong signs of recovery in November, as indicated by Statistics Korea data for overall industrial output registering a month-on-month increase of 3.2 percent. This figure is the sharpest increase in 17 months, since 3.9 percent in June of last year. The notable rebound in the November figure came due primarily to a base effect in October, when the month-on-month figure for overall industrial output dropped 1.9 percent, sapped by two extra holidays and a solid performance in September. Also anchoring November's figure was a solid recovery in car manufacturing and service industries, buoyed by the government's “Living with COVID-19” scheme.The economy will have to brace for heightened uncertainty in the months to come, as foreshadowed by rapidly weakening consumer sentiment due to the Omicron variant-induced stricter social distancing measures, compounded further by supply chain disruptions and rising inflat

Dec 30, 2021By Lee Kyung-min
Industrial output surge offers mixed hopes of recovery
Economy

Global security control system

A Shinhan Bank employee points at an electronic board that monitors overseas cyberattacks around the clock in a control room of the bank headquartered in Seoul, Thursday. Courtesy of Shinhan Bank

Dec 30, 2021By Lee Kyung-min
Global security control system
Society

Bank branch closures criticized for disregarding elderly

Members of a local consumer rights group hold a protest in front of the Financial Supervisory Service headquarters, on Yeouido, Seoul, Dec. 23. YonhapBy Lee Kyung-min A recent decision by Shinhan Bank to scrap a plan to shutter a branch in Nowon, northern Seoul, has called into question whether the lenders are mindlessly railroading the profit-oriented, cost-cutting measure at the expense of elderly customers.Korea's top five banks ― KB Kookmin, Shinhan, Woori, Hana and NH NongHyup ― say their collective, rapid move to drastically reduce the number of branches and install small kiosks is an inevitable and critical part of a digital transformation, a global wave of change that cannot be reversed. But consumer rights groups representing an older, less digitally literate group of people, say lenders have little to no regard for senior citizens with limited access to smart technologies or devices, claiming that outright denial of in-person, face-to-face services makes them no less vulnerable to financial fraud such as voice-phishing. Also coming under criticism is why Shinhan is shutteri

Dec 29, 2021By Lee Kyung-min
Bank branch closures criticized for disregarding elderly
Economy

Korea to launch industrial security advisory body

First Vice Minister of Trade, Industry and Energy Park Jin-kyu. Korea Times fileBy Lee Kyung-min The industry ministry has decided to establish an external advisory body dedicated to enhancing the country's industrial security policies, as part of its efforts to better manage supply chain issues threatening the long-term growth of local exporters and technology developers as well as the expansion of foreign investment.The measure seeks to strengthen protections for the country's key growth driver firms and cooperation with their peers in advanced economies, to strengthen and set up bilateral and multilateral supply chains to be insulated from unforeseen disruptions and complications, not unlike the COVID-19 pandemic. In talks with Korea for the shared objectives are the U.S. and European countries. The Ministry of Trade, Industry and Energy said Tuesday that the advisory body will be composed of 17 academic and private-sector experts with in-depth knowledge and experience. Senior researchers at state-run think tanks, lawyers and university professors will join the group. “The g

Dec 28, 2021By Lee Kyung-min
Korea to launch industrial security advisory body
Economy

Contribution Korea urged to tackle demographic challenge for sustainable growth

Rajiv BiswasBy Rajiv BiswasThe South Korean economy rebounded in 2021 with estimated GDP growth of 4 percent despite the ongoing COVID-19 pandemic. The outlook for 2022 is for sustained economic expansion at a pace of around 3 percent. However, despite the high share of the South Korean population that is fully vaccinated, the pandemic continues to be a key downside risk to the economic growth outlook for 2022. The detection of an increasing number of local cases of the highly transmissible Omicron variant during mid-December has added to fears about an escalating COVID-19 wave extending into early 2022. The OECD advanced economies and Asia-Pacific industrial nations are expected to be the key growth engines of the world economy in 2022. The impact of the COVID-19 pandemic is expected to be gradually contained in these nations, helped by their high current vaccination rates and access to vaccines for booster shots. This will support the continued expansion of domestic demand in these economies, as well as driving growth in world trade.Reflecting sustained global economic expansion,

Dec 28, 2021By Lee Kyung-min
[Contribution] Korea urged to tackle demographic challenge for sustainable growth
Economy

Fast-aging Korea losing vibrancy

gettyimagesbankBy Lee Kyung-min Calls are mounting for a prompt overhaul of the National Pension Service (NPS) among other state-run social safety net programs, a discussion that can no longer be delayed in a fast-aging society where a fifth of the total populations of two out of five municipalities are aged 65 or older.The need to advance the politically divisive, key voting issue is increasing, with Korea's working-age population on a rapid decline driven in large part by an ultra-low birthrate. This is the prime cause of a sharp fall in the country's potential growth rate on the fastest decline among OECD member nations.Korea's fiscal soundness will come under threat sooner than expected, unless swift and drastic measures are implemented to address the survivability of organizations certain to report losses due to sagging overall labor productivity.Further fanning the concerns are the country's militant unions in an extremely rigid labor market, the biggest and most-frequently cited risk factor deterring hefty, long-term foreign investments.Potential growth rate, or potential GDP,

Dec 27, 2021By Lee Kyung-min
Fast-aging Korea losing vibrancy
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