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KOREA REPORT - AUGUST, 2021.
TOPICS.
SKorea's
daily new coronavirus cases reached new high of 2,223 on 11th, in the face of monthlong toughened virus curbs and slower than
expected vaccination campaign. The daily virus caseload exceeded 1,000 for the
first time on July 7th and stayed above 1,000 for 35 days. More than five months into vaccination program, 21% of Korea¡¯s 51 mil
people are completely vaccinated with either one-dose of Johnson &
Johnson vaccine or two doses of AstraZeneca, Pfizer or Moderna vaccines, as of
19th.
S&P
Global Ratings said on 4th it would keep the country¡¯s economic growth rate
outlook for 2021 and credit rating unchanged, citing
robust exports. It projected SKorea to grow 4% and kept the credit rating at
AA. The ASEAN-sponsored economic
research agency on 23rd raised its 2021 growth forecast for SKorean economy to
3.9%, citing solid recovery in exports and facility investment. The
projection by ASEAN+3 Macroeconomic Research Office (AMRO) marks an increase
from its March estimate of 3.2%. It forecast SKorean economy would expand 3%
next year.
SKorea's
trade surplus recorded $1.67 bil in Aug,
marking 16th consecutive month of surplus. Outbound shipments came to $53.2
bil, jumping 35% on-year, on back of robust demand for chips and automobiles,
and underpinning recovery momentum in the economy. Exports of chips led overall
gains, advancing 43% to reach $11.7 bil. Imports climbed 44% to $51.5 bil.
Posco
said on 29th that it has forged a five-way partnership encompassing
shipbuilders and ship registries to develop liquid carbon dioxide carrier tanker, as part of its bid
to gain an upper hand in the global transition to a net-zero economy. According
to the agreement signed on 27th, companies will cooperate with an aim of
launching by 2025 the vessel with cargo capacity of at least 20,000 cbm. Posco
will be in charge of development of the steel for the tank that will contain
liquefied carbon dioxide.
SKorea's
foreign reserves came to $463.9 bil in Aug, up
$5.25 bil on-month rising to an all-time high, thanks to allocation of
International Monetary Fund's Special Drawing Rights. Foreign securities came
to $418.3 bil, up $3.4 bil on-month, accounting for 90.2% of FX reserves. Gold holdings remained
unchanged at $4.79 bil. SKorea was world's eighth-largest holder of FX
reserves.
Bank of Korea on
26th raised its benchmark interest rate to 0.75% from its previous
record-low rate of 0.5%, citing the economy¡¯s ¡°modest¡± pace of recovery and
rising inflation. The move is projected to gradually end ¡°ultralow interest
rate¡± that has continued since BOK slashed its key rate to 0.5% in May last
year.
Despite of recent
order spikes, Korean Big3 made losses of about KW3 tril ($2.56 bil) in total
for the first half of 2021. DSME announced on 17th that it logged revenue of
KW2.1712 tril ($1.846 bil), operating loss of KW1.2203 tril and net loss of
KW1.2470 tril for the first six months. KSOE and SHI made losses of KW 829.8 bil
and KW944.7 bil, respectively. Such poor results are quite a contrast to
what they did in new order sales sector. According to industrial source, the Big3
have been awarded newbuilds worth $30.4 bil in total so far this year,
achieving 95.9% of their yearly order goals. The problem is that three
companies' new order intakes are not reflected in this year's business results
immediately. Read more¡¦
Discussion between
Korean shipbuilding and steel industries on thick plate price for 2H 2021 is
being finalized. According to Korean industrial source, Korean Big3,
KSOE, SHI and DSME have recently reached an agreement with POSCO on the price
of thick plate for ship construction. While POSCO does not reveal the
amount agreed, steel industry players see the parties agreed to set the thick
plate price to KW1.1 mil ($943) per ton.
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