Date: March 8, 2011
Source: Hankyung Economy
The centerpiece of South Koreas economic policy is steering away from its original goal of growth and price stabilization towards inflation crisis management.
The shift in the central aim came under the judgment that if the national economy is forced to achieve 5% growth, it could be overwhelmed with enormous structural uncertainties over prices, far from taming inflation at 3%.
It is forecast that March 10th will become the watershed moment of the countrys economic policy as the national economic council meeting presided by President Lee Myung-bak and the Bank of Korea (BOK)s Financial Monetary Committee meeting will take place.
"The global economy enjoyed benefits from low prices and interest rates maintained by China for the past decade, but that kind of global economic landscape has totally transformed," an official from the Blue House said on Wednesday. "It is time for the government to devise mid- and long-term measures in response to such structural changes."
"Uncertainties over prices cause overall uncertainties in the economy. It is hard to be optimistic about recovery of our economy," Strategy and Finance Minister Yoon Jeung-hyun said in an event held by the National Strategy Institute (NSI) on the same day.
Yoons remarks suggest that the nations economy chief stance on the economy has slightly changed from the previous focus on microeconomic measures targeting supply-side inflation.
MOSF and other relevant government departments have started on the review process to assess whether core external variables, such as international oil prices, need to be revised prior to adjusting the target for growth and price levels. The former forecast for oil prices - set at $85 per barrel (for Dubai crude) - will be the first to be modified.
The market is paying keen attention to the BOKs Monetary Policy Committee meeting on Thursday. The Libyan unrest and other instabilities in the Middle East, which were the main obstacles to raising key rates in the past, are no longer considered to be a long-term problem, and this forecast will have some impact on the committees decision.
Market expectation is leaned towards a hike in interest rates. The BOK has been clear on its intention to gradually raise the key rate. In a progress report submitted to the National Assembly, the BOK had stated that it will "gradually phase out easy money policies."
"Our decision will be aimed at creating sturdy growth and stabilizing prices. We will be taking into account all domestic and external variables, as well as financial and economic conditions," said the BOK.
Meanwhile, import prices of raw materials peaked in 30 months. According to the Korea Importers Association (KOIMA), the KOIMA index, which shows the general trend in import prices of raw materials, hit 373.4 points last month, recording the second highest figure after August of 2008 (411.3 points).
Date: March 10, 2011
Source: JoongAng Daily
Leaders in the South Korean business community drew a blueprint for the Korean economy. The Federation of Korean Industries (FKI) decided to establish visions for the national economy for the next 10 decades based on ideas of healthy capitalism and creative market economy in a meeting of chairmen and chief executives in Seoul on Thursday.
The FKI set three main goals to be achieved by 2030: higher than 5% annual growth, $100,000 in gross national income (GNI) per head, and the 10th largest economy in the world. Broadly, the business community aims to drive up the Korean economy, currently on the 15th place globally, to 12th by 2020 and 10th by 2030.
The chairmen group shared a view that the FKI must be there for the people, and so decided to seek opinions from civil activity groups, trade unions, youth groups and small and medium-size businesses (SMBs).
Better communication is what new Chairman Huh Chang-soo has been emphasizing since he took office last month.
The chairmen agreed to work with the government proactively to promote shared growth and address inflation-related issues. In particular, they decided to join forces with the government to prevent currently high oil prices from hurting livelihoods of the working class.
To sustain growth in exports that prop up the entire economy, the FKI called for early ratification of the free trade agreement (FTA) with the United States and with the European Union.
Since the range of global competition today broadened from business versus business, business corps versus business corps to country versus country, the FKI decided to make efforts to improve Koreas business ecosystem to be globally competitive.
Date: March 10, 2011
Source: Hankyung Economy
South Koreas Vice Minister of Strategy and Finance Yim Jong-ryong said government task force (TF) teams on high oil prices and mobile rates must produce visible outcomes as early as possible in addressing the issues.
"The market pins high hopes on the TF teams participated by the Ministry of Knowledge Economy (MKE), the Fair Trade Commission (FTC) and the Ministry of Strategy and Finance (MOSF). It is so urgent that the oil price TF has to act swiftly to tackle the oil price issue," Yim said in a meeting on price stabilization on Friday.
"The main task regarding mobile phone charges is to improve the charging system to actually make cuts in consumers bills. Since this issue must not take longer time, the mobile TF will have to wrap up its work by the end of April," Yim underscored.
"According to joint monitoring of jeonse prices, or the countrys long-term lease housing contracts in around 10 regions by the Ministry of Land, Transport and Maritime Affairs (MLTM) and the MOSF, the price rises are showing signs of declining in the epicenter of the overall price hike, but prices are still on the rise in other reasons," the vice minister pointed out.
Yim reiterated that the key to taming inflation in April and May is striking a balance in supply and demand and stabilizing prices.
"Cabbage prices are expected to rise from the end of March through early April because of drops in shipment of cabbages for winter storage. When cabbages for spring are shipped out, the prices will be return to normal after mid-April," Yim projected.
Date: March 11, 2011
Source: Mail Business Newspaper
Struggling under the weight of a raw material spike, CJ, South Koreas top seller of wheat flour and sugar products, said on March 11 it will raise its sugar output price by 9.8% on average.
The increase followed a 9.7% markup three months ago. With the new measure, white sugars output price will go up to 1,436 won ($1.28) per kilogram from 1,309 won and the 15kg product will rise to 18,605 won from 16,928 won.
CJ blamed its money-losing situation on the surge of raw sugar prices in the international market and explained the increase is inevitable.
Raw sugar prices remain more than 31 cents per pound since they hit a 30-year high of 36.03 cents on February 2.
"We had to endure losses while cooperating with the government but the raw sugar price surged 210% over the past two years. Without the additional increase, we will lose 40 to 50 billion won in the sugar sector in the first half alone," a company official said.
CJs operating profit fell 21% last year and other sugar producers suffered a decrease in profits.
Date: March 11, 2011
Source: JoongAng Daily
The Ministry of Knowledge Economy has released its trade figures for the month of February. The trade surplus recorded $2.85 billion, down from $2.9 billion in January. The month-on-month decline is attributable to the Lunar New Year holiday, which fell in February this year and resulted in four fewer business days.
Despite unfavorable conditions in the global market, brisk outbound shipments of petroleum products and automobile parts drove exports up 17.9 percent year on year to $38.96 billion. Most of Koreas key export items displayed doubledigit growth. Notably, the average value of exports per day hit an all-time high, totaling $2.05 billion. The previous record was $1.94 billion.
With the exception of Latin America and Oceania, exports to most of Koreas key trading partners increased during the first 20 days of February. Outbound shipments to China of textiles, automobile parts and petrochemicals grew 34.5 percent, 24.3 percent, and 19.3 percent, respectively. Outbound shipments of petroleum products to Japan surged 107.2 percent; while exports of ships to the United States and the European Union shot up 110.6 percent and 435.3 percent, respectively.
Meanwhile, imports climbed 16.3 percent to record $36.11 billion. The average value of imports per day stood at $1.9 billion, representing an increase of 25.5 percent from a year ago. During the first 20 days of February, with coal and crude oil gaining 63.3 percent and 34.1 percent, respectively, inbound shipments of raw materials went up 15.1 percent. While imports of capital goods slid 8.6 percent, the corresponding figure for consumer goods was 18.7 percent.
Date: March 14, 2011
Source: Yonhap News
South Korea succeeded in securing access to a minimum of 1.2 billion barrels of crude oil by singing contracts to participate in oil field development projects in Abu Dhabi, the United Arab Emirate (UAE).
Abu Dhabi, holding as much as 100 billion barrels of oil in reserve, is the sixth largest oil-field region in the world, where only a few major global oil companies are allowed to enter. The 1.2 billion barrels of oil amount to a volume that can be used in Korea for 14 months.
"South Korea signed a contract with the UAE to secure the right to participate in oil field development projects in Abu Dhabi," President Lee Myung-bak said in a press conference on March 13th in the UAE.
Earlier, President Lee held a summit with his UAE counterpart Sheikh Khalifa bin Zayed Sultan Al Nahyan and promised bilateral cooperation on energy. Lee and Shaikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, joined signing a Memorandum of Understanding (MOU) on oil and gas cooperation, and a separate Heads of Terms (HOT) on three oil fields between Korea National Oil Corporation (KNOC) and Abu Dhabi National Oil Company (ADNOC).
The MOU on cooperation on oil and gas development allows Korea to take part in exploring large oil fields holding more than one billion barrel after 2014 when the current developers rights to mining will expire. Korea and the UAE will sign a formal contract next year and start oil production from 2014.
Under the HOT on three oil fields holding 570 million barrels in PIIP (Petroleum Initially In Place), Korea is expected to discover 200 million barrels of oil in total. A formal contract will be signed this year, and production will begin from 2013, with a daily capacity of 35,000 barrels. The contract includes a provision that Korea can hold 100% stakes in the three oil fields.
Date: March 14, 2011
Source: Yonhap News
If you notice an increase in pink, red and heart-shaped merchandise in shop windows today, dont panic; youre not stuck on a time loop repeating Valentines Day.
Today is White Day - celebrated in Korea as a counterpart to Valentines Day - when men are called to bestow gifts on women instead of the other way around. And this year major retailers are expanding their White Day offerings after enjoying one of the best Valentines Day sales on record last month.
Lotte Department Store reported
cake-making classes today. Provided by CJ Foodville yesterday that it had expanded its White Day-related merchandise by 30 percent after seeing its Valentines Day sales jump by 65 percent from last year.
E-Mart has bolstered its White Day merchandise inventory with sales expected to climb by 20 percent from a year ago. "As this years White Day falls on a Monday, we have increased the amount of merchandise since we expect brisk White Day gift sales over the weekend," said Lee Seon-geun, a buyer at E-Mart.
Convenience store chain 7-Eleven, which saw 32 percent more revenue on White Day than Valentines Day last year, plans to expand merchandise costing 10,000 won ($8.88) or more to take advantage of the fact more expensive gifts sell well on White Day since men usually are willing to splash out for their girlfriends.
Companies are staging special events for White Day. Twosome Place, the cafe and cake franchise of CJ Foodville, is holding cake-baking classes today at Daehangno and CGV Songpa in central and southern Seoul. For 27,000 won, the price of a large or premium cake, men who want to add a personal touch to their White Day gifts can bake their own cake under the guidance of a master baker.
A survey of 336 male professionals conducted by job search portal Incruit last week found that seven out of ten men are planning to give White Day gifts this year. The average gift budget per person reached 129,000 won and 48.8 percent said that candy or chocolate will be their first choice of gifts.
However, caution is advised when choosing candy for that special someone. The Korea Food & Drug Administration warned on Thursday that 12 out of 66 domestic candy manufacturers it had reviewed had unhygienic work environments or failed to properly mark expiration dates. Consumers "are advised to check expiration dates," said a KFDA official.
Office of Commercial Affairs, Royal Thai Embassy in Korea
Source : http://www.depthai.go.th