Exports and investment remained in the doldrums, with export curbs from Japan and widening trade conflict between the United States and China adding uncertainties to the trade-reliant Korean economy, the government said.

“Uncertainties are growing amid the global economic slowdown stemming from downturn in manufacturing sector and chip market with added trade woes from Japan’s export curbs and escalating tariff war between the United States and China,” the Ministry of Finance and Economy said in its monthly economic review named Green Book for August.

The ministry described the country’s current economic situation as ‘sluggish’ for the fifth straight month since April, the longest period since the monthly report came out from March 2005. In April and May, it said key economic data including factory output, facility investment and exports stayed weak, but from June to August, it pointed exports and investments as sluggish.

The nation’s industrial output fell 0.7 percent in June against the previous month due to a 1.0 percent drop in service output despite a 0.2 percent growth in mining and manufacturing production. Capital investment gained 0.4 percent on month after slipping 7.1 percent a month earlier.

Exports tumbled 11 percent from a year ago in July, extending its losing streak for the eighth consecutive month since December 2018 due to the chip industry downturn and prolonged trade dispute of the world’s two biggest economies. The coincident indicator measuring present economic activities edged down 0.1 percentage point in July against a month earlier and leading indicator for future economic cycle also declined 0.2 percentage point.

According to preliminary data, domestic automobile sales in July shrank 3.7 percent from the previous year, with sales of department stores and discount stores also down 3.4 percent and 10.7 percent, respectively.

On the other hand, online shopping sales grew 1.7 percent and domestic credit card purchases increased 3.8 percent over the same period. The number of Chinese visitors to Korea jumped 26.9 percent. The number of employed Koreans rose 299,000 in July compared to the same month a year ago, while unemployment rate inched up 0.2 percentage point to 3.9 percent. Consumer price index gained 0.6 percent, staying below 1 percent for seven months in a row.

By Sohn Il-seon and Choi Mira

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