ID :
21244
Thu, 09/25/2008 - 21:27
Auther :
Shortlink :
http://m.oananews.org//node/21244
The shortlink copeid
U.S. financial crisis may hurt S. Korean balance of trade: official
SEOUL, Sept. 25 (Yonhap) -- Ongoing financial uncertainties in the United States
may adversely affect South Korea's balance of trade, which has remained in the
red all this year, a senior policymaker said Thursday.
Vice Knowledge Economy Minister Rim Che-min said in a meeting with industry
umbrella groups that uncertainties in the financial sector triggered by the
Lehman Brothers debacle early last week may spill over into consumer sentiment
and investment down the road, possibly hurting exports.
"The government is in the process of trying to determine what side effects the
financial instability will have on individual industries, and is trying to set up
countermeasures that can alleviate such problems," the official said.
The comments mark the first time a high-ranking official raised concerns about
the direction of future trade.
As of early September, before Lehman filed for bankruptcy protection, the
government predicted that a surplus could be maintained in the remaining four
months of the year if oil prices started falling off.
South Korea's trade deficit, in the black for over a decade, posted a deficit of
US$12.3 billion up till August, mainly due to the sharp rise in crude oil and
other raw material costs.
Industry sources, meanwhile, said consumer demand in advanced industrial
countries like the United States and Europe may suffer, causing exports of mobile
phones and autos to decrease towards the latter part of the year.
In the U.S. the Thanksgiving holidays, Christmas and New Years have traditionally
spurred demand for South Korean made goods.
Local shipbuilders and others in the manufacturing sector added that a drying up
of funds and facilities investments could hurt future shipbuilding orders, as
well as steel and petrochemical exports.
Entrepreneurs, meanwhile, asked the ministry to help reduce losses incurred by
companies that signed up for currency option contracts called "knock-in knock-out
(KIKO)."
The derivatives, originally designed to reduce risks caused by a rise of the
Korean won versus the U.S. dollar, have become serious liabilities following the
won's sharp depreciation against the greenback.
may adversely affect South Korea's balance of trade, which has remained in the
red all this year, a senior policymaker said Thursday.
Vice Knowledge Economy Minister Rim Che-min said in a meeting with industry
umbrella groups that uncertainties in the financial sector triggered by the
Lehman Brothers debacle early last week may spill over into consumer sentiment
and investment down the road, possibly hurting exports.
"The government is in the process of trying to determine what side effects the
financial instability will have on individual industries, and is trying to set up
countermeasures that can alleviate such problems," the official said.
The comments mark the first time a high-ranking official raised concerns about
the direction of future trade.
As of early September, before Lehman filed for bankruptcy protection, the
government predicted that a surplus could be maintained in the remaining four
months of the year if oil prices started falling off.
South Korea's trade deficit, in the black for over a decade, posted a deficit of
US$12.3 billion up till August, mainly due to the sharp rise in crude oil and
other raw material costs.
Industry sources, meanwhile, said consumer demand in advanced industrial
countries like the United States and Europe may suffer, causing exports of mobile
phones and autos to decrease towards the latter part of the year.
In the U.S. the Thanksgiving holidays, Christmas and New Years have traditionally
spurred demand for South Korean made goods.
Local shipbuilders and others in the manufacturing sector added that a drying up
of funds and facilities investments could hurt future shipbuilding orders, as
well as steel and petrochemical exports.
Entrepreneurs, meanwhile, asked the ministry to help reduce losses incurred by
companies that signed up for currency option contracts called "knock-in knock-out
(KIKO)."
The derivatives, originally designed to reduce risks caused by a rise of the
Korean won versus the U.S. dollar, have become serious liabilities following the
won's sharp depreciation against the greenback.
