South Korea recorded 0.1 percent growth in the first quarter, narrowly avoiding recession, after its exports slump slowed amid unprecedented rate cuts and stimulus spending, the central bank said yesterday.
The result, which follows a 5.1 percent contraction in the December quarter, means Asia’s fourth largest economy escaped its first recession — defined as two successive quarters of negative growth — since 1998.
However, the export-dependent economy still shrank 4.3 percent year-on-year after contracting 3.4 percent in the final quarter of last year.
“Private spending and construction investment swung to gains and a decline in exports slowed down in the first quarter,” the Bank of Korea said in a statement.
Exports fell 3.4 percent quarter-on-quarter in the three months ended March 31, after declining 12.6 percent in the December quarter.
But private spending grew 0.4 percent quarter-on-quarter compared with a 4.6 percent contraction in the previous period.
The government last month unveiled a 28.9 trillion won (US$21.3 billion) extra budget to stimulate the economy, complementing extra spending announced earlier.
The central bank has cut its base rate by 325 basis points since October to 2 percent, a record low.
“The [South] Korean economy is still on a downturn trend although a sharp decline in economic activity eased considerably in the first quarter,” Choi Chun-sin, head of the central bank’s economic statistics division, told reporters.
“We need to see at least 1 percent on-quarter growth before we can say the economy has hit bottom,” he said.
The central bank predicts the economy will shrink 2.4 percent this year with growth of 3.5 percent next year.
CLOSURES: Several forest recreation areas have been closed as a precaution, while some ferry and flight services have been suspended or rescheduled A land warning for Tropical Storm Danas was issued last night at 8:30pm, as the storm’s outer bands began bringing heavy rain to southeastern regions, including Hualien and Taitung counties, and the Hengchun Peninsula (恆春半島), according to the Central Weather Administration (CWA). As of 9:15pm, the storm was approximately 330km west-southwest of Oluanpi (鵝鑾鼻), Taiwan proper’s southernmost tip, moving north-northeast at 10-20kph, the CWA reported. A sea warning had already been issued at 8:30am yesterday. The storm had maximum sustained winds near its center of 83kph, with gusts of up to 108kph, according to the CWA. As of 9:30pm last night, Kaohsiung, Tainan,
POWERFUL DETERRENT: Precision fire and dispersed deployment of units would allow Taiwanese artillery to inflict heavy casualties in an invasion, a researcher said The nation’s military has boosted its self-defense capability with the establishment of a new company equipped with the US-supplied High Mobility Artillery Rocket System (HIMARS). The company, part of the army’s 58th Artillery Command, is Taiwan’s first HIMARS unit. Minister of National Defense Wellington Koo (顧立雄), who presided over the formation ceremony in Taichung on Friday, called the unit a significant addition to the nation’s defensive strength, saying it would help deter adversaries from starting a war. The unit is made up of top-performing soldiers who received training in the US, according to the Ministry of National Defense. The HIMARS can be equipped with
STRONG WINDS: Without the Central Mountain Range as a shield, people should be ready for high-speed winds, CWA weather forecaster Liu Yu-chi said Danas was yesterday upgraded to a typhoon and could grow stronger as it moves closely along the nation’s west coastline, the Central Weather Administration (CWA) said. Hsinchu and Chiayi cities, Taichung, Tainan and Kaohsiung, as well as Hsinchu, Miaoli, Changhua, Yunlin, Nantou, Chiayi, Penghu and Pingtung counties have canceled work and school today. Work and school in Keelung, Taipei, New Taipei City and Taoyuan, and Yilan, Taitung, Hualien, Kinmen and Lienchiang (Matsu) counties would continue as usual, although offices and schools would be closed in Taoyuan’s Luju (蘆竹), Dayuan (大園), Guangyin (觀音) and Sinwu (新屋) districts. As of 5pm yesterday, the typhoon’s
UNILATERAL: The move from China’s aviation authority comes despite a previous 2015 agreement that any changes to flight paths would be done by consensus The Mainland Affairs Council (MAC) yesterday slammed Beijing for arbitrarily opening the M503 flight route’s W121 connecting path, saying that such unilateral conduct disrespected the consensus between both sides and could destabilize the Taiwan Strait and the wider region. The condemnation came after the Civil Aviation Administration of China (CAAC) earlier yesterday announced it “has activated the W121 connecting path of the M503 flight route,” meaning that west-to-east flights are now permitted along the path. The newly activated west-to-east route is intended to “alleviate the pressure caused by the increase of flights,” China’s state-run Xinhua news agency quoted China’s Taiwan Affairs Office
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