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KOREA REPORT - JANUARY, 2023.
TOPICS.
Wearing face masks will no longer be
required indoors in Korea starting Jan 30th, PM Han Duk-soo said on 20th. Places that will be mask-free include schools, kindergartens,
child care centers and department stores. Also on mask-free list are outdoor
and indoor spaces at subway and train stations and airports. Requirement to
wear face masks at virus-prone facilities such as hospitals, long-term care
facilities, pharmacies and public transportation like chartered buses, taxis
and flights is still in place. The seven-day quarantine requirement for
those infected is still valid. Jan 30th marks three years since Korea
identified its first case of COVID-19.
The
UAE decided on 15th to invest $30 bil (KW37 tril) in SKorea at a summit held
between President Yoon and Emirati leader Sheikh Mohammed bin Zayed Al Nahyan. The $30 bil is considered to be the largest-ever investment in a
single country by the UAE. Previously, the largest cross-border investment by
the UAE was $12.2 bil in the UK. The UAE plans through its sovereign fund to
invest $30 bil over the next few years in high-level next-generation nuclear
power such as small modular reactors, energy technologies using hydrogen,
renewable energy such as wind and solar power, and defense. Two leaders also
confirmed they would strengthen strategic cooperation in nuclear and hydrogen
energy in the UAE¡¯s post-oil era, as well as collaboration in space, carbon
emissions and technological innovation. Read more¡¦
Concerns over deepening economic slowdown
and a bleak outlook for global business conditions, experts
predicted that this year SKorea¡¯s economy would fall deep into a dark and
chaotic situation. Korea Chamber of Commerce and Industry summarized the
opinions of 85 economics and management experts including university professors
as "falling down the rabbit hole." It
includes inflation at levels not seen for decades, an unprecedented period of
long-term low growth and rapidly changing export paradigm. The group of experts
painted a gloomier outlook for 2023 than those forecast by major institutions.
They said the economy would grow at around 1.25%, while Bank of Korea and the
International Monetary Fund predicted rates of 1.7% and 2.0%. The largest
economic risks that the country faces are high interest rates, followed by
rising inflation and raw material prices, slow exports, and sluggish domestic
consumption.
SKorea
reached a record-high monthly trade deficit of $12.69 bil in Jan, mainly due to weakening
global demand for semiconductors, according to Ministry of Trade, Industry
and Energy. While outbound shipments fell 16.6% on-year to $46.27 bil, the
largest drop in three years, imports slipped 2.6% on-year to $58.96 bil. The
figure broke the previous record high of $9.43 bil in Aug last year. It is also
the first time that the country saw a trade deficit for 11 consecutive months
since 1997. In Jan, exports of semiconductors recorded $6 bil, down 44.5%
on-year.
PERFORMANCE OF FOURTH QUARTER
Hyundai
Motor Group Executive Chair Chung Euisun has been named MotorTrend Person of
the Year, it announced on 12th. With the award, Chung topped the US
automobile magazine's list of the 50 most influential figures in global
automotive industry. He was ranked fifth in last year¡¯s rankings. MotorTrend
acknowledged Chung for leading Hyundai Motor Group into a new age, underscoring
that the vehicles developed under his leadership are notable for their
¡°eye-catching design, quality, clever packaging and good value¡± and that
Korean-made vehicles are ¡°proving increasingly difficult to beat.¡±
SKorea's
foreign reserves come to $429.97 bil as of end Jan, up
$6.81 bil on-month, driven by weak dollar that bolstered the dollar-converted
value of other currency-based assets. Foreign securities, such as US
Treasuries, had been valued at $371.42 bil as of end Jan, which accounted for
86.4% of total foreign reserves. The value of deposits stood at $34.17 bil,
which made up 7.9% of the total. SKorea was ranked world's ninth-largest holder
of foreign reserves as of end Dec.
Bank
of Korea on 13th raised the benchmark rate from 3.25% to 3.5%, the highest level since 2008, to tame inflation. It was the
seventh straight rate increase since April last year, the longest span of
tightening. It is also the highest figure in more than 14 years, since the rate
stood at 4% in Nov 2008.
SKorea's
consumer prices rose 5.2% on-year in Jan, as
energy costs shot up to a record level, amid expectations inflation will
gradually slow throughout 2023. The prices of utility services went up 28.3% on-year in Jan
amid prolonged war between Russia and Ukraine, the sharpest
growth since 2010. The price of agricultural, fisheries and
livestock products moved up 1.1% on-year, price of chicken
shot up 18.5% and that of rice
decreased 9.3%. Industrial product
prices increased 6% on-year, due mainly to rises in diesel and
bread costs. Core inflation rose 4.1% on-year in Jan.
Competition and
Consumer Commission of Singapore (CCCS) started its review of Hanwha Group's
acquisition of DSME, according to industry sources. Hanwha
believes acquisition will have little impact on the competitiveness of
Singaporean market. However, CCCS requested Hanwha Group to submit a letter of
application due to group's business activities in Singapore, which Hanwha Group
submitted on 16th. The law prohibits any business takeover that could weaken
competitiveness of Singaporean market. CCCS will be collecting public opinions
until Feb 3rd. The countries that will evaluate corporate combination are
SKorea, the EU, Japan, China, Singapore, Turkey, Vietnam, and the UK. Read more¡¦
Three units of KSOE
have released their sales forecast for 2023. According to HHI, its sales
forecast for 2023 is KW12.12 tril ($9,529 mil), HMD expects sales to reach KW4.152 tril in
2023 and HSHI announced its 2023 sales forecast of KW6.51 tril. Read more¡¦
The Korean
government dramatically increased the budget for development of eco-friendly
ships this year. Ministry of Trade Industry and Energy (MOTIE) announced 2023¡¯s
eco-friendly ship development implementation plan on 30th. This
year¡¯s eco-friendly budget is KW145.4 bil ($115.8 mil), increasing by 52% from
KW95.6 bil in 2022 to KW145.4 bil. The project will be carried out jointly by
the MOTIE, the Ministry of Oceans and Fisheries (MOF), and the Ministry of SMEs
and Startups (MSS). Key technologies for carbon-free ships include hydrogen or
ammonia-fueled engine, and propulsion systems for electric ships. Looking at
each field, a total of 73 tasks will be carried out in four major areas. Read
more¡¦
CLICK
HERE to read ¡°Korea Report - January 2023¡± in a FLIPBOOK.
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