SEOUL/SEJONG, Nov. 27 (Korea Bizwire) - Weak exports are starting to impact industrial output and business investment in South Korea, the country’s top economic policymaker said Friday.
Chairing the meeting of foreign economy-related ministers in Seoul, Finance Minister Choi Kyung-hwan said outbound shipments in October plunged at the sharpest rate in more than two years.
“This drop is beginning to cause problems in industrial output and investment,” the official claimed.
Last month, Asia’s fourth-largest economy reported a 15.9 percent plunge in goods shipped abroad, marking the 10th straight month that exports contracted compared with the year before. In the January-October period, exports were down 7.6 percent on-year to US$440.2 billion.
The official, who doubles as deputy prime minister in charge of economic affairs, then said that to cope with a drop in exports, parliament must ratify the free trade agreement (FTA) signed with China as soon as possible.’
“The South Korea-China FTA must be approved quickly if exports to China are to get a boost and make it easier for local companies to make inroads into the vast market,” Choi said. “The FTA with China can breathe new life for local exporters.”
He also pointed out that if the open trade pact goes into effect within the year, South Korean companies will benefit from additional tariff cuts in 2016.
Lawmakers from the ruling and opposition parties agreed in principle to pass the China FTA on Monday. The government called on the National Assembly to approve the FTA within the month.
Besides the FTA, Choi said the government is committed to helping young people find good jobs abroad.
He called on government agencies, foreign diplomatic missions and the private sector to work closely so young people can find work in foreign countries.
Related to this plan, the labor ministry said it aims to find work abroad for 10,000 people in 2017, up from 5,000 at present.
The ministry said it will set up specific strategies so Koreans can find work in 15 countries and provide special training programs at local universities so jobseekers can acquire the skills needed to get employed.
Choi, meanwhile, said that South Korea has called for closer cooperation among countries to strengthen a worldwide financial sector safety net that can better tackle sudden, financial sector volatility.