The Korea Times

Trade falling; deflation snapping

By Yoon Ja-youngConsumer prices have risen by less than 1 percent for five consecutive months.In addition, both exports and imports have decreased for four months in a row amid sluggish world trade.As a result, economists call for a breakthrough to resuscitate the stalling economy.According to Statistics Korea, Friday, consumer prices rose 0.4 percent in April year-on-year. When excluding the 0.58 percent rise triggered by the cigarette tax hike, the country has been experiencing deflation for three consecutive months.  Kim Bo-Kyung, the head of the agency's prices statistics division, explained that the fall in oil and energy prices was behind the low inflation.Oil prices have fallen by 20.9 percent as of April year-on-year, pulling down overall inflation by 1.1 percentage points. Liquefied natural gas provided to urban areas also fell by 14 percent.“While service prices, including rents, have been rising steadily, these falling factors pulled down inflation to below 1 percent,” she said.Kim added that the fall in processed goods prices due to bargain sales at

May 1, 2015By Yoon Ja-young

Economy

Property market showing recovery signs

By Yoon Ja-youngThe government raised the official appraisal prices of apartments by 3.1 percent this year, reflecting the recovery in the housing market. The housing market continued to recover in the first quarter of the year. Lower mortgage rates, an improvement in investor sentiment and the passage of bills aimed at boosting the real estate market are helping the recovery, a state-run think tank said.The Ministry of Land, Infrastructure and Transport announced the official appraisal prices of 11.6 million apartments around the country, Wednesday. The official appraisal price is used for taxation.The official price rose by 3.1 percent this year. While it rose by only 2.5 percent in Seoul, Gyeonggi Province and Incheon, other regions led the rise. Daegu saw the price rise by 12 percent and Jeju by 9.4 percent.Also notable was a hike in the prices of small apartments rather than big ones. While small apartments with less than 85 square meters in area saw between a 2.8 to 4 percent rise in prices, those bigger than 85 square meter saw prices rise by between 1.4 and 2.8 percent.&ldquo

Apr 29, 2015By Yoon Ja-young

Economy

KCCI to hold photo contest

The Korea Chamber of Commerce and Industry (KCCI) announced that it will hold its second photo contest.Under the theme of “Enterprise, Life and People,” participants are encouraged to submit any photos related to enterprises and their lives. The contest is open to both Koreans and foreigners.Participants can submit their photos online as well as via smartphones, at the official website of the contest, http://kcciphoto.korcham.net, from May 1-Sept. 30. The submission fee is 1,000 won for each piece of the work, and all profits will be donated.The winner of the grand prize will be given 30 million won; the two second-place winners will get 5 million won each; and each of the five third-place winners will receive 2 million won. The 30 fourth-place winners will each get 500,000 won.The winners will be announced in November and their work will be exhibited and produced as a video clip. The video clip of last year’s winners is available at http://www.korcham.net/nCham/Service/Economy/appl/kcciphotoplay.asp.“In the first contest last year, around 2,000 photos were su

Apr 29, 2015By Yoon Ja-young

Economy

Won hits seven-year high against yen

By Yoon Ja-young The won has reached its highest level against the yen in more than seven years.The weakening yen is adding to the concerns of exporters competing with Japanese companies.The arbitrated exchange rate of the two currencies touched 897.28 won per 100 yen on Tuesday morning.The market uses an arbitrated rate for won and yen as there is not a direct trading market between the currencies. The exchange rate is therefore calculated using a won/dollar rate combined with the yen/dollar rate. Only the U.S. dollar and the Chinese yuan are directly traded in Korea’s foreign exchange market. The value of other currencies, such as the yen and the euro, against the won are shown in an arbitrated rate.Analysts explained that exporters selling U.S. dollars and an inflow of dollars from foreign stock investors strengthened the won. Foreign investors have bought stocks worth 4.6 trillion won on the Seoul bourse since April 7.The won is expected to strengthen further against the yen.“While foreign investment into Japan including stocks and bonds led to a 5-trillion-yen i

Apr 28, 2015By Yoon Ja-young

Economy

Abenomics takes toll on Korea

By Yoon Ja-youngJapanese Prime Minister Shinzo Abe is continuing with “Abenomics,” an economic policy based on massive quantitative easing and weakening of the yen, which Japan claims will save it from its “lost” two decades.  While Japan has partly succeeded in boosting its economy, that seems to be based on the sacrifice of other countries, of which Korea has been hit the hardest.Lee Bu-hyoung, senior research fellow at the Hyundai Research Institute, said Abenomics is exploiting other countries.“As each country is in a different economic situation, the other countries may be damaged if one of them only pursues its own interest through totally new policies. The foreign exchange rate is an example,” he said.The researcher stressed that it is against WTO regulations to manipulate foreign exchange rates. “By devaluating its own currency, the country can increase exports while decreasing imports, earning more from trade. The gain, however, is based on the loss of other countries.”He said that the international community seems to be t

Apr 27, 2015By Yoon Ja-young

Economy

Weak yen calls for rate cut

By Yoon Ja-young A weaker yen against the won is overshadowing the nation’s economy and adding pressure on the Bank of Korea to cut its key rate to address the fallout from the Japanese government’s weak yen policy, analysts said Friday.Further rate cuts seem to be the only option, with exporters losing price competitiveness and the economy haunted by the specter of deflation, they said.The won/yen rate neared 900 won per 100 yen, which compares with 1,500 won per 100 yen in June 2012.The Hyundai Research Institute warns that exports may decrease 8.8 percent from the previous year if the Korean currency remains highly valued against the Japanese currency.  An Ki-tae, an economist at NH Investment and Securities, said Korea has few options as Japan will continue with the quantitative easing.He said that the won is facing pressure to strengthen against the yen. “It’s because of the huge current account surplus. Japan also recorded a surplus in March, but not as much as Korea.” He said the won/yen rate should go below 900 won per 100 yen when cons

Apr 24, 2015By Yoon Ja-young

Economy

Won hits 7-year-high against yen

Exchange rate touches below 900 per 100 yenBy Yoon Ja-youngThe won touched the highest level against the Japanese yen in seven years and two months Thursday, adding to concerns over its effect on exports.The Korean currency extended its gains, with the exchange rate falling to a daily low of 902 won per 100 yen during the session on the local foreign exchange market.It managed to close above the psychologically significant level as the won corrected its earlier gains, closing at 903 won per 100 yen, dealers said.After reaching its lowest level of more than 1,500 won per 100 yen in and around June 2012, the won has been strengthening against the Japanese currency after Tokyo’s implementation of “Abenomics,” which led to massive quantitative easing.On top of the Japanese government’s weak yen policy, increasing inflows of dollars for purchases of Seoul stocks helped strengthen the Korean currency, dealers said.Foreigners have bought more than 3.5 trillion won shares in Seoul this month. The inflow of dollars increases the supply in the foreign exchange market an

Apr 23, 2015By Yoon Ja-young

Economy

Loss from Keangnam scandal totals W1.1 tril.

By Yoon Ja-youngLenders, subcontractors and investors are expected to sustain some 1.1 trillion won in losses due to Keangnam Enterprises, a construction company at the center of a recent bribery scandal.The company, which was founded in 1951, has been making headlines since its chairman, Sung Woan-jong, committed suicide two weeks ago, leaving a list of politicians he claimed to have bribed. On the list were close aides to President Park Geun-hye, including Prime Minister Lee Wan-koo, who has offered to resign. Sung was being investigated for alleged corruption in the “energy diplomacy” of administration of former President Lee Myung-bak.  According to financial industry sources, 17 banks and non-bank lenders have exposure to Keangnam. Among them, the state-run Export-Import Bank of Korea sustained the biggest loss as Keangnam has 520.8 billion won in debt with the bank. Shinhan Bank lent 176.1 billion won, and Korea Development Bank (KDB), Nonghyup and Suhyup have more than 50 billion won in loans each.Keangnam also borrowed a total of 11.8 billion won from Woori I

Apr 22, 2015By Yoon Ja-young

Economy

Minister vows to handle strikes sternly

Strategy and Finance Minister Choi Kyung-hwan speaks at the economic ministers’ meeting held in Yeouido, Seoul, Wednesday. He said the government will take stern action against the strike planned by the labor circle. / YonhapBy Yoon Ja-young Strategy and Finance Minister Choi Kyung-hwan warned that the government will deal sternly with a strike scheduled for this week by the umbrella union.“Some in the labor circles are moving for a general strike. However, the strike is aimed at protesting against government policy, not for improvement of labor conditions.”“It is an illegal strike that has no justification,” Choi said at the economic ministers’ meeting Wednesday.“Those in the labor circles should think twice about whether the strike will help the youth, the people and the economy, and try to find a solution through dialogue.”“If they insist on the illegal strike anyhow, the government will sternly deal with it based on law and principles,” he said.The Korea Confederation of Trade Unions (KCTU), the country’s lead

Apr 22, 2015By Yoon Ja-young

Economy

KIC faces state auditor's inspection

By Yoon Ja-young The Korea Investment Corporation (KIC) is facing an inspection by the Board of Audit and Inspection over a planned investment in the Los Angeles Dodgers.The National Assembly Strategy and Finance Committee held a meeting, Tuesday, and approved a request for an audit of the KIC.According to lawmakers, the country’s sovereign fund is planning to invest $400 million to gain a 19 percent stake in the Major League Baseball (MLB) team from Guggenheim Baseball Management, its largest shareholder.However, there has been concern that it might result in huge losses because the team has been in deficit for some few years. Analysts also point out that the KIC won’t be participating on the board either even if it becomes a co-owner of the team according to the deal.The committee determined that the KIC may have been slack in assessing profitability and the risk in diverse alternative investments it is making.Rep. Kim Hyun-mee of the main opposition New Politics Alliance for Democracy (NPAD) said the deal is risky because it blocks the KIC from selling its stake i

Apr 21, 2015By Yoon Ja-young

Yoon Ja-young

Read more

Trade falling; deflation snapping

Property market showing recovery signs

KCCI to hold photo contest

Won hits seven-year high against yen

Abenomics takes toll on Korea

Weak yen calls for rate cut

Won hits 7-year-high against yen

Loss from Keangnam scandal totals W1.1 tril.

Minister vows to handle strikes sternly

KIC faces state auditor's inspection

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