In the face of recession for the first time in 17 years south Korea.South Korea, Asia’s fourth-largest economy, is in recession for the first time in 17 years due to a coronavirus epidemic. In the first two quarters of this year, their exports declined sharply, resulting in a decline in gross domestic product (GDP).
The Bank of Korea said on Thursday that South Korea’s GDP fell 3.3 percent in the April-June quarter, much higher than in the first three months of the year. In the first quarter of this year, the GDP contracted by about 1.3 percent. This is the first time since 2003 that South Korea’s economy has shrunk in two consecutive quarters. Moreover, this quarter’s rate of economic contraction is also the highest since 1998.
Forty percent of South Korea’s economy is export-oriented. However, due to the epidemic, their exports have dropped by at least 16.6 percent, the highest since 1963. At the same time, their imports have decreased by about 7.4 percent.
However, Korean spending on sustainable consumer goods, such as cars or home appliances, has risen by about 1.4 percent.
South Korean Finance Minister Hong Nam-ki is hopeful that the economy will return to normal soon despite the contraction. He said government spending, the disbursement of cash and the slowdown in transition could help the economy recover.
“If the pace of infection slows down and production starts abroad and schools and hospitals are opened, we can turn around in the third quarter like China,” Hong said.
News Room, july 23,2020