South Korea’s central bank said yesterday it now expects the economy to shrink 1.6 percent this year, revising its earlier forecast of a 2.4 percent contraction, with a return to positive growth in the second half.
The Bank of Korea also raised its growth projection for next year to 3.6 percent from a 3.5 percent forecast in April.
The finance ministry and private economists have made similar upward adjustments in the belief that Asia’s fourth largest economy has touched bottom.
“Korean GDP in the second half is expected to recover to the level before the collapse of Lehman Brothers last September,” the central bank said in a statement.
It said the economy will probably expand 0.2 percent year-on-year in the second half following an expected 3.4 percent decline in the first half.
But it cautioned of downside risks from rising oil prices and the waning effects of the fiscal stimulus.
The bank said exports are now expected to fall 2.8 percent this year, less than a previous prediction of a 9.9 percent slump.
Private spending would likely fall 1.4 percent this year compared with an earlier estimate of a 2.6 percent decline.
Facility investment is expected to tumble 15.1 percent this year while construction investment will probably gain 2.2 percent.
The economy narrowly avoided falling into recession in the first quarter by expanding 0.1 percent from the previous quarter, after tumbling 5.1 percent in the fourth quarter of last year.
Late last month the finance ministry said it expected GDP to contract 1.5 percent this year compared to its earlier forecast of a 2 percent contraction.
It maintained its growth forecast of 4 percent for next year.
The central bank said the country will likely shed 110,000 jobs this year, down from an earlier forecast of 130,000, on the back of government efforts to boost job creation.
NEXT GENERATION: The four plants in the Central Taiwan Science Park, designated Fab 25, would consist of four 1.4-nanometer wafer manufacturing plants, TSMC said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) plans to begin construction of four new plants later this year, with the aim to officially launch production of 2-nanometer semiconductor wafers by late 2028, Central Taiwan Science Park Bureau director-general Hsu Maw-shin (許茂新) said. Hsu made the announcement at an event on Friday evening celebrating the Central Taiwan Science Park’s 22nd anniversary. The second phase of the park’s expansion would commence with the initial construction of water detention ponds and other structures aimed at soil and water conservation, Hsu said. TSMC has officially leased the land, with the Central Taiwan Science Park having handed over the
The Philippines is working behind the scenes to enhance its defensive cooperation with Taiwan, the Washington Post said in a report published on Monday. “It would be hiding from the obvious to say that Taiwan’s security will not affect us,” Philippine Secretary of National Defense Gilbert Teodoro Jr told the paper in an interview on Thursday last week. Although there has been no formal change to the Philippines’ diplomatic stance on recognizing Taiwan, Manila is increasingly concerned about Chinese encroachment in the South China Sea, the report said. The number of Chinese vessels in the seas around the Philippines, as well as Chinese
URBAN COMBAT: FIM-92 Stinger shoulder-fired missiles from the US made a rare public appearance during early-morning drills simulating an invasion of the Taipei MRT The ongoing Han Kuang military exercises entered their sixth day yesterday, simulating repelling enemy landings in Penghu County, setting up fortifications in Tainan, laying mines in waters in Kaohsiung and conducting urban combat drills in Taipei. At 5am in Penghu — part of the exercise’s first combat zone — participating units responded to a simulated rapid enemy landing on beaches, combining infantry as well as armored personnel. First Combat Zone Commander Chen Chun-yuan (陳俊源) led the combined armed troops utilizing a variety of weapons systems. Wang Keng-sheng (王鏗勝), the commander in charge of the Penghu Defense Command’s mechanized battalion, said he would give
AUKUS: The Australian Ambassador to the US said his country is working with the Pentagon and he is confident that submarine issues will be resolved Australian Ambassador to the US Kevin Rudd on Friday said that if Taiwan were to fall to China’s occupation, it would unleash China’s military capacities and capabilities more broadly. He also said his country is working with the Pentagon on the US Department of Defense’s review of the AUKUS submarine project and is confident that all issues raised will be resolved. Rudd, who served as Australian prime minister from 2007 to 2010 and for three months in 2013, made the remarks at the Aspen Security Forum in Colorado and stressed the longstanding US-Australia alliance and his close relationship with the US Undersecretary
RSS