Officials in the Finance Ministry and Statistics Korea have raised the possibility that the sagging economy will gradually vitalize in the coming months, citing favorable indices in the industrial sector.
They took a prudent stance, however, on publicizing a positive outlook. They stressed that “as uncertainties at home and abroad still remain,” risk factors must be closely monitored to attain national economic recovery.
Concerning the December data for industrial output from the state-run Statistics Korea, a director-general of the Finance Ministry said the nation saw indices for production and investment in sectors like mining, services, construction and facilities improve from a month earlier.
“For better indices, we will bolster risk management. It is also necessary to promote enterprises’ facilities investment to boost the economy,” he said.
His remarks came a day after a Statistics Korea official predicted that “the economy will be vitalized as indices have been favorable since November.”
Other public officials pointed to the ongoing eurozone debt crisis and the Korean won’s appreciation against major currencies as major risk factors.
They also said a key factor is whether lackluster private consumption will recover amid mounting household debt.
The nation saw the ratio of household debt to gross domestic product surpass the average held by Organization for Economic Cooperation and Development members.
According to the Korea Chamber of Commerce and Industry, Korea’s household debt-to-GDP ratio reached 81 percent, exceeding 73 percent of the OECD average.
On Wednesday, Statistics Korea said that production in the mining, manufacturing, gas and electricity industries increased 0.8 percent last month from the year before.
Output expanded 1 percent from a month earlier, marking the fourth straight month of growth since September, the data showed.
The service-sector output grew 0.1 percent on-month and 1 percent on-year.
Despite declines in the electricity and gas businesses, the December output growth was driven by increases in the mining and manufacturing sectors.
Corporate investment figures showed some signs of improvement.
But facilities investment fell 6.3 percent on-year in December, marking the fifth straight month of decline since August. From a month earlier, however, it grew 9.9 percent.
Private consumption remained in a slump. Retail sales grew 1.5 percent last month from a year earlier but slowed from the previous month’s 4.1 percent gain. From a month earlier, they shrank 1.1 percent.
By Kim Yon-se (email@example.com