07 mars 2018
The latest outlook on the economic and trade perspectives for Korea.
On Wednesday, March 7, FKCCI has organized its yearly event on the economic perspectives for the year to come, the Economic Forecasts seminar, at Millenium Hilton Hotel Seoul.
Trade growth, economic development, consumer’s trends and potential obstacles were analyzed by the speakers and discussed with the audience.
Despite the challenging international context, the unbalanced exports dynamics, the labor market and social reforms, there is a large consent that the growth rate to be achieved by Korea in 2018 will be 3 %.
The event’s speakers covered macroeconomic issues as well as real market aspects. The discussion was moderated by Dr. Jang-Hyuk LEE, Professor at Korea University Business School.
Mr. Michel DROBNIAK, Head of the Economic section at the French Embassy in Korea, delivered its macroeconomic point of view of the 2017 achievements and outlooks for 2018. An upwards trend has been noticeable for the past 3 years and Korea is doing much better than the average of the advanced countries. The main contributors to the 2017 growth in Korea were foreign trade, facilities investments and the construction sector.
For 2018, the rate of GDP growth will likely remain the same but engines will be quite different. While exports and foreign trade will remain a high driver, the construction sector will go down and investment will continue to grow but at a much lower pace. The macroeconomic fundamentals of Korea are very solid: the employment rate is expected to remain stable and government debt stays under 40% of GDP. However, the domestic demand remains quite weak and the growth between sectors performing well (IT, semi-conductors industry) and others is unbalanced. Regarding government policy and fiscal policies, the pro-income policy is not expected to significantly deteriorate the fiscal balance and government debt in the next 5 years.
As for the geopolitical environment, the highest risk is coming from the relation between US and Korea. At the long term, the most important challenges for Korea will be demography and productivity.
Mr. Suktae OH, Chief Korea Economist at Société Générale bank focused on the “global economy and financial market outlook". The bank’s view for 2018 is quite optimistic. It is the “brightest and most optimistic year since the 2008 economic crisis”, even if a US recession is expected. Since 2017, the global trade growth is more important than the global GDP growth. This trade recovery is the most important good news for the global economy.
Mr. Junho LEE, Director, FMCG (Fast-Moving Consumer Goods) industry group at Nielsen Korea delivered a presentation on "the evolving omnichannel landscape". He compared sales data by channel (hypermarket, supermarket, department store, duty free, CVS, online etc.) and stressed that the biggest growth is currently happening in online and cvs channels. Mobile phone (rather than PC) has mainly contributed to the ecommerce growth. Besides, ecommerce mobile apps are becoming an important source of information (price comparison, reviews, product attribute) for the consumers. The current trends in ecommerce are premium goods, personalization (online tools to guide and support the consumer’s choice) and “O2O” - online to offline, offline to online, mixing these channels to find a way to work together to meet the consumer’s needs -.
This event was attended by the French-Korean business community and by representatives of Embassies and other public institutions.
See the event's pictures here