Business sentiment for July pessimistic over prolonged manufacturing slump: poll
The business survey index of the country's top 600 companies by sales stood at 94.6 for next month, according to the monthly poll by the Federation of Korean Industries.
A reading below 100 means pessimists outnumber optimists, while a figure above the benchmark means the opposite. The index has now remained below 100 for 40 consecutive months since April 2022.
The BSI for manufacturing sectors stood at 86.1, compared with 103.4 for nonmanufacturing sectors. Manufacturing sentiment has stayed negative for 16 months, while the service sector index rebounded for the first time in seven months.
Within manufacturing, only the food, beverage and tobacco sectors combined showed a positive outlook. Among nonmanufacturing sectors, lodging, dining, logistics and retail led the gains.
"Service sector business confidence is showing signs of recovery due to expectations for fiscal stimulus and summer travel demand," an FKI official said. "But bolstering export competitiveness and the preemptive response to trade friction remain critical for the recovery of manufacturing industries." (Yonhap)
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Korea Herald
14 hours ago
- Korea Herald
Lee meets business leaders ahead of summit in US
Tycoons voice hopes that summit in Washington will open doors to new markets, boost global reach Ahead of his first summit with US President Donald Trump, South Korean President Lee Jae Myung met Tuesday with South Korea's leading business chiefs to map out strategies for boosting the economic outcomes of next week's Washington visit. During the meeting at the presidential office in Seoul, Lee expressed appreciation for the business leaders' contributions to the recent tariff negotiations with the United States, which he said helped deliver better-than-expected results. "The government's top priority is to revitalize the economy and lay the foundation for sustainable growth," Lee was quoted as saying by presidential spokesperson Kang Yu-jung. "While both the government and businesses are facing difficulties due to changing export conditions, we must join forces to turn this crisis into an opportunity." The closed-door meeting, which lasted about two hours, brought together major business leaders and senior government officials, including presidential Chief of Staff Kang Hoon-sik, National Security Adviser Wi Sung-lak, Minister of Trade, Industry and Energy Kim Jung-kwan, and Trade Minister Yeo Han-koo. In response, Ryu Jin, chair and CEO of Poongsan Group and head of the Federation of Korean Industries, said the recent deal with Washington had helped reduce uncertainty and restore momentum for Korean businesses. "The recent agreement with Washington helped eliminate uncertainty for Korean exporters and restored growth momentum. The business community will continue to be a strong partner to the government," he said. Samsung Electronics Executive Chair Lee Jae-yong emphasized the group's commitment to continued domestic and overseas investment. "We will maintain our commitment to investing not only in the United States but also here in South Korea to foster high-value industries and create quality jobs," he said. Seo Jung-jin, founder and chair of Celltrion Group, urged a forward-looking approach in a time of change. "A crisis can become an opportunity. We must prepare for future industries with a new perspective," he said. "To cultivate capable young entrepreneurs, we need to boost investment in startups rather than relying solely on collateral-based loans," he added. According to the presidential office, business leaders expressed hope that the upcoming summit would produce tangible outcomes benefiting both corporate and national interests. They said the visit should serve as a stepping stone for expanding Korean companies' access to the US market and enhancing their global competitiveness. President Lee said he would carefully consider the leaders' on-the-ground insights and encouraged them to achieve meaningful results during the trip, the presidential office added. Tuesday's meeting followed the government's announcement of a revised tariff agreement with the United States late last month. On July 31, the government confirmed that planned US tariffs on Korean exports would be reduced from 25 percent to 15 percent. In return, South Korea pledged a total of $350 billion in investments into the US, including $150 billion for shipbuilding cooperation and $200 billion for strategic sectors such as semiconductors, batteries, and biopharmaceuticals. Seoul also agreed to purchase $100 billion worth of US energy products. Lee's trip to the US will include a two-day stop in Tokyo for talks with Japanese Prime Minister Shigeru Ishiba prior to the summit with Trump.
Korea Herald
a day ago
- Korea Herald
S. Korea, Britain agree to accelerate talks to upgrade FTA
Senior diplomats of South Korea and Britain on Monday agreed to speed up negotiations to upgrade a bilateral free trade agreement as part of efforts to expand trade and investment, the foreign ministry said. Second Vice Foreign Minister Kim Jina and Catherine West, parliamentary under secretary of state for the Indo-Pacific at the Foreign, Commonwealth and Development Office in Britain, reached the agreement during the Senior Economic Dialogue. During the talks, the two sides explored ways to expand cooperation in areas such as trading and investment, economic security, artificial intelligence and quantum technology, the defense industry and energy, the ministry said in a release. They also agreed to expedite talks to revise the FTA in line with the agreements made by President Lee Jae Myung and British Prime Minister Keir Starmer on the sidelines of the Group of Seven summit in Canada in June. Last month, trade delegations of the two countries held the fifth round of negotiations on easing regulations on product origins and introduced new rules in the areas of supply chains and digital trade. In addition, Seoul officials asked for the British government to "favorably review" its safeguard measures against homegrown steel products and an electric vehicle subsidy scheme to ensure fair competition for Korean companies, it noted. During the two-day stay, West will meet Second Deputy National Security Adviser Lim Woong-soon to discuss regional security and support for Ukraine, and visit the Demilitarized Zone separating the two Koreas and meet North Korean defectors, the British Embassy in Seoul said. (Yonhap)
Korea Herald
2 days ago
- Korea Herald
'Resting' youth cost economy over 10 trillion won a year: report
An increasing number of highly educated young people are neither working nor seeking employment An estimated 53.4 trillion won ($38.5 billion) in potential economic output may have been lost between 2019 and 2023 due to an increasing number of young South Koreans who voluntarily stayed out of the workforce, a new study showed Monday. The report by Professor Lee Mi-suk of the Changwon National University, commissioned by the Federation of Korean Industries, quantified the economic impact of a youth population that chose to 'rest' during the five-year period. This refers to those between the ages of 15 and 29 who were neither employed nor looking for a job and had no particular reason such as academic study, training or housework. Those who were unemployed but looking for a job, or were in the process of obtaining credentials for future employment, were not considered to have rested. The study found that 8.89 trillion won could have been added to the economy in 2019 if voluntarily unemployed youth had worked that year, followed by 11.45 trillion won in 2020, 10.36 trillion won in 2021, 11.17 trillion won in 2022, and 11.51 trillion won in 2023. The estimates are based on assumed monthly earnings equivalent to 80 percent of the salaries of their working peers, which ranged from 1.55 million won in 2019 to 1.79 million won in 2023. Legally-mandated insurance fees were deducted, and the adjusted monthly income was multiplied by 12 to estimate the potential net income the group would have contributed to the economy each year had they been employed. The percentage of people in the 15-29 age demographic who were resting increased from 4.48 percent in 2019 to 5.47 percent in 2023. Compared to the total population, 0.93 percent of young Koreans rested in 2023, up from 0.84 percent in 2019. The youth population itself decreased from 9.66 million to 8.79 million during the same period. Data shows more young people who received higher education chose not to work. In 2019, 159,000 with a bachelor's degree or higher rested, but the number increased to 184,000 in 2023. "Many young people who could be receiving high salaries are resting, causing economic loss (to the country)," the report said. A report last week by Statistics Korea showed that 421,000 Koreans in their 20s rested in July, marking an all-time high for the month since the government started compiling the statistic. The employment rate for the 15-29 group marked a 0.7 percent decrease on-year, in contrast to an increase in employment for the general population. Lee's study suggested that the government should approach the issue from multiple angles, such as expanding scholarships based on work-study programs and career guidance for young people to motivate them to seek employment.
