Korean Industrial Output Posts Biggest Gain in 4 Years in Recovery Sign
Korea Industrial Output Posts Biggest Gain in 4 Years (Repeat)
(Repeats to fix typographical error in 1st paragraph.)
Seoul, Feb. 25 (Bloomberg) -- South Korea's industrial
output posted its biggest gain in almost four years in January
and private consumption expanded for the first time in 15 months,
indicating the faltering economy is on track to expand.
Output grew at an annual rate of 14.7 percent -- the largest
gain since July 1995, led by robust exports of semiconductors and
transportation equipment. It was the third consecutive monthly
gain and compared with a 4.8 percent increase in December.
The National Statistical Office said more Koreans turned
optimistic about an economic turnaround, evidenced in a 2.8
percent increase in combined wholesale and retail sales, the best
measure of demand in the economy.
Spending on big-ticket items such as automobiles jumped 129
percent in January from a year ago. Sales of machinery and
telecommunications equipment were also brisk. Last year,
consumption shrank by a monthly average of 12.5 percent.
''Now we can say for sure the economy has embarked on the
expansionary cycle,'' said Song Keum Young, an NSO official.
''Because indictors for consumption and investment are also
showing steady growth.''
The office noted the figures reflect the longer period of
working days -- two days more -- in January this year from the
same year-earlier month.
The Korean economy slipped into its worst recession in 45
years after the country turned to a nearly $60 billion bailout
the International Monetary Fund pulled together in December, 1997
to avert national bankruptcy.
Growing Optimism
Several other key indicators also point to recovery, fueling
expectations the Korean economy would grow at least 2.0 percent
this year against an estimated 5.5 percent contraction last year
as forecast by the IMF.
Domestic machinery orders, a gauge of corporate investment,
jumped 39.6 percent in January from a year earlier, led by the
shipbuilding and automobiles sectors. It compared with a 0.8
percent rise in December and an average 30.5 percent decline for
the entire 1998.
Shipments of goods for domestic use also increased for the
first time since November, 1997, expanding at an annual 6.1
percent rate in January against a 10.9 percent fall in December.
Those for export rose 23.2 percent, compared with 25.4 percent.
However, factory use by manufacturers dropped to 69.2
percent of the total capacity last month, from 70.5 percent in
December, plagued by a strike in LG Semicon Co. and slowing
production at refineries.
Inventories in January fell another 16.6 percent from a year
ago. The depleted stockpiles will allow companies to increase
output, helping to accelerate an economic pick-up.
Bucking the overall trend, the construction sector still
remained in a slump. New construction orders dropped 20.5 percent
in January from a year ago, compared with an annualized 42.5
percent drop for the entire 1998.
The NSO said the economic outlook is continually improving.
The index of leading indicators, a prediction of economic
activity six to seven months ahead, rose for a fourth consecutive
month. The index advanced 8.3 percent last month from a year ago. |
