Over 8 in 10 South Korean firms see Trump's return as negative factor for economy
More than 8 out of 10 South Korean companies expect Donald Trump's reelection as US president will have a negative impact on the national economy, a survey showed on Sunday.
IANS
Dec 1, 2024 10:48
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Seoul, Dec 1 (IANS) More than 8 out of 10 South Korean companies expect Donald Trump's reelection as US president will have a negative impact on the national economy, a survey showed on Sunday.
In the annual survey on 239 companies with at least 30 employees on their management, 82 percent said the Korean economy will be negatively affected by the protectionist policy of the incoming second Trump administration as it has high dependence on exports, according to the Korea Enterprises Federation (KEF).
Only 7.5 percent answered the Korean economy will benefit from his reelection thanks to his China policy, expected to be aimed at curbing the growth of the world's second-largest economy, reports Yonhap news agency.
Amid uncertainties surrounding the economy, 49.7 percent of the companies said they plan to go into belt-tightening mode next year, while 28 percent and 22.3 percent plan to maintain the status quo and expand their business, respectively.
The KEF said the rate of companies going on austerity management was the highest since 2019.
As measures for austerity, cost reduction was cited the most at 66.7 percent, followed by the efficient use of manpower at 52.6 percent and a decrease in new investments at 25.6 percent.
The local companies forecast the Korean economy will grow 1.9 percent next year and start recovering after 2026, according to the KEF.
Meanwhile, the Bank of Korea (BOK) lowered its outlook for South Korea's economic growth next year to 1.9 per cent, pointing to a slower-than-expected export growth amid growing concerns over potential changes in the trade policies of the United States and other major economies.
The latest figure marks a 0.2 percentage-point fall from its projection presented in August and also comes below the country's potential growth rate of 2 percent.
