Manufacturing sector props up South Korean economy
17. June 2021The Korean Institute of Industrial Trade and Economics announced the related news on May 5, 2021: South Korea ranks third in the CIP index out of 152 countries, behind Germany and China. The 2018 Competitive Industrial Performance (CIP) Index was released by the United Nations Industrial Development Organization (UNIDO) in July last year. Out of 28 major nations, South Korea ranked second in manufacturing, the institute added. The decline in South Korea’s economic growth last year was only 40 percent of the G7 average. Unemployment went up by only 15 percent compared to the G7 nations.
According to the institute, the South Korean economy did relatively well as exports from the domestic manufacturing industry went up. The Covid 19 pandemic had only a negative impact on local demand for manufactured goods, according to the institute’s evaluations. South Korean companies in semiconductors, displays and petrochemicals are market leaders in their segments and contribute the most to the country’s exports. Many of the manufacturers are well connected in international markets and have corresponding sales opportunities. However, the institute advises that the export market situation should be closely monitored, as there have been recent shifts in buyers due to the trade dispute between China and the United States.
In other news, the OECD recently upgraded its forecast for this year’s South Korean economic growth from 3.3 to 3.8 percent. High foreign demand for IT products, which account for 20 percent of exports, was highlighted here, as well as an increase in the popularity of cars made in South Korea. The Bank of Korea is even more optimistic in its forecast and even sees economic growth of 4.0 percent this year. If this target is achieved, it would be the highest growth rate since 2010.
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