KITA News
  • Trade Protectionism and Financial Uncertainties in Emerging Countries Continue Next Year
    2018-12-04

    Trade Protectionism and Financial Uncertainties in Emerging Countries Continue Next Year

     

    - KITA 2019 Outlook of World Economy Seminar’ … urgent to diversify exports and work on high value-added exports -  

     

    It is expected that uncertainties in the global economy will further increase in the next year due to global monetary tightening and possible financial instability in emerging economies, in addition to the trade disputes between the United States and China.

     

    In the seminar titled 2019 Outlook of World Economy and Export Market Diversification Strategy held at the Trade Tower in Samseong-dong on November 30th, the Institute for International Trade (President, Shin Seung-kwan) of the Korea International Trade Association dealt with next year's outlook of global economy, forecast of global trade environment and exchange rate, major export markets and items, and new northern policy.

     

    The first speaker Ahn Sung-bae, head of the International Macroeconomics and Finance Department at the Korea Institute for International Economic Policy said, Next year, not only the United States, Europe and Japan but also emerging economies such as China, are expected to record low growth rates, compared to this year. He also anticipated, The external risks of Korean exporters will be expanded due to the visible effects of the trade disputes between the United States and China, increasing interest rates of major countries government bonds, falling oil prices, and the likelihood of financial crisis in emerging countries.

     

     

    Je Hyun-jung, a deputy general manager at the Center for Trade Studies and Cooperation of the Korea International Trade Association, said in the presentation titled Global Trade Environment Outlook, US sanctions on China are one of the ways to check China's high-tech industry and China will not easily give up with a view to realizing China Dream’”. She stressed, Korean companies need to reduce its export dependency on the United States and China and promote market diversification in preparation for prolonged disputes, and consider trade issues at all times when establishing business plans.

      

    In regards to domestic and foreign exchange rate outlook, Lee Chang-sun, a senior researcher at the LG Economic Research Institute, said, "The Korean won's depreciation will prevail next year, but it is likely to turn into a stronger trend in the second half of the year." He also added, Korea needs to keep in mind the volatility of the exchange rate and the possibility of a crisis in emerging countries caused by the United States Federal Reserve Boards plans for interest rate hikes."

      

     

    Moon Byung-ki, a researcher at the Korea International Trade Association, delivered a presentation on '2019 Export Items and Market Prospects' and said, "This year, Koreas trade has achieved 1 trillion dollars for two consecutive years and its exports has surpassed 600 billion dollars in for the first time in history, and the exports of semiconductors have reached 100 billion dollars. He elaborated, "However, the outlook of automobiles, steel, mobile phones, and displays for next year is dark and Korean companies have to push ahead with high value-added exports mainly in consumer goods, new industries, and parts industries."

      

     

     

    Professor Jeon Myung-soo of Vladivostok State University of Economics and Service, said, The Northern market is a good alternative for export market diversification. He asserted, Korea needs to approach the northern market focusing on promising industries such as cosmetics, pharmaceuticals and healthcare and carry out localization strategies by entering into the service industries.

     

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