South Korea’s export-led economy likely grew by 2.7 percent last year, slightly above the latest government estimate, and felt little impact from the impeachment of its president, South Korean Minister of Finance Yoo Il-ho told Reuters in an interview on Wednesday.
A bigger risk to the economy was the “uncertainty from abroad,” including the incoming administration of US president-elect Donald Trump, Yoo said.
Yoo — on a visit to New York and Boston to meet with investors and bankers to gauge their views on South Korea, as well as gain insight into the US political landscape — said the previously unreported GDP revision could indicate solid growth for the first quarter of the year.
“We expected that the final revision of our estimation of last year’s growth rate was 2.6 percent, down from 2.8 percent,” he said.
“It turned out to be 2.7 percent at the end of ’16, which in turn means there is a possibility that the economy in Korea is not so weak as we expected, at least in the first quarter, judging from this 0.1 percent higher growth than we expected than the final revised value,” he said.
However, he said it was too soon to decide if South Korea’s habit since 2000 of implementing a supplementary budget to bolster a weak economy was necessary.
On Dec. 28, the government slashed the economic growth estimate for Asia’s fourth-largest economy to 2.6 percent for this year from an earlier estimate of 3 percent.
Yoo said that the corporate restructurings of the “so-called oversupplied industries” of shipping, shipbuilding, steel, construction and petrochemicals were ongoing.
“For the shipbuilding, I guess we may have tens of thousands [of lost jobs] in the process, but for the other sectors, it is really hard to tell,” Yoo said.
The government has been in turmoil since the impeachment of South Korean President Park Geun-hye in an influence-peddling scandal. A constitutional court must decide soon whether to uphold the Dec. 9 decision by lawmakers.
While consumer confidence has plunged to a seven-and-a-haf-year low in the wake of the vote, Yoo believes the nation is taking the vote in stride.
“We have not seen any real meaningful fluctuation or meaningful impact from inside politics yet. Maybe there is some kind of psychological factor on consumption or investment, but that doesn’t seem too big so far,” he said.
“In the near future, until the Constitutional Court’s decision, I don’t see a real big thing, big impact,” he said.
Yoo met with dozens of investors, including Goldman Sachs Group CEO Lloyd Blankfein and Blackstone Group CEO Stephen Schwarzman, who also chairs Trump’s business advisory council.
He said he wanted to get a read on how the incoming administration’s political maneuvers, trade policies and tax cuts might impact South Korea.
“My impression was that they found it difficult to exactly pinpoint the specific direction that the Trump administration will take in terms of the policies,” Yoo said.
“They seem to believe that the policies are going to be different from what the candidate Trump had said and what the president Trump is going to do,” he added.
Yoo also said he did not expect any big changes in the free-trade agreements between South Korea and the US.
Gogoro Inc (睿能創意) yesterday launched its first electric bicycle, the Gogoro Eeyo 1, in Taiwan, after unveiling the bike in New York in late May and in France on Tuesday. The company said it would also introduce the series in other European countries such as Germany and the Netherlands. The “Eeyo project” is the fourth of Gogoro’s eight projects that concentrate on smart transportation, which includes Gogoro’s electric scooter, battery swap system and electric scooter sharing service, company founder and chief executive officer Horace Luke (陸學森) told a media briefing in Taipei. “There are various types of city commuters. We will not
EXPERIMENTAL DRUG: While news about a COVID-19 vaccine is more eye-catching, developing a treatment would be more viable, the Senhwa boss said Senhwa Biosciences Inc (生華科) aims to raise NT$1.5 billion (US$50.57 million) by issuing 15 million new common shares in the third quarter of this year to fund the research of new drugs, including the experimental drug Silmitasertib for the treatment of COVID-19, the company said on Monday. That would be the firm’s largest fundraising effort after it raised more than NT$1.4 billion from an initial public offering on the Taipei Exchange (TPEX) in April 2017, chief financial officer Sarah Chang (張小萍) told the Taipei Times by telephone. The price of the new shares would depend on the firm’s average share price
NOT A PANACEA: Offering 5G services would not solve the problem of declining telecom incomes, chairman Sheih Chi-mau said, expecting a flat 5G telecom revenue Chunghwa Telecom Co (中華電信) yesterday became the nation’s first telecom to debut its 5G services, offering tiered tariffs that include a threshold of NT$599 and flat rates, as it aims to switch half of its subscribers to the 5G network within three years. Subscribers would have unlimited data transmission for monthly fees starting at NT$1,399 — the same flat rate as when the company launched its 4G service in 2014 — and they can subscribe to the highest-rate plan for NT$2,699 per month for faster data transmission speeds and larger bandwidth, the company said. Data transmission speeds would be within the range
ROW: A probe would determine if the rights of shareholders who were not allowed to vote yesterday had been violated, while the stock exchange also wants answers The election of board directors yesterday at Tatung Co (大同) sparked controversy after the company blocked some institutional and individual shareholders from participating in the general shareholders’ meeting, prompting the Financial Supervisory Commission (FSC) to announce that the vote would be investigated. Lin Kuo Wen-yen (林郭文艷) was re-elected as chairwoman of the household-appliance maker’s nine-member board, but prior to the vote she announced that several shareholders would not have voting rights. They were being denied a vote because they had contravened the Business Mergers and Acquisitions Act (企業併購法), and the Act Governing Relations Between the People of the Taiwan Area and