South Korea minister warns of fallout of US-China trade war

Overseas shipments account for more than half of the South's economy, with more than a quarter of exports shipped to China and about 12 per cent to the US.

Published: 18th July 2018 12:47 PM  |   Last Updated: 18th July 2018 12:48 PM   |  A+A-

China flag US flag

Overseas shipments account for more than half of the South's economy, with more than a quarter of exports shipped to China and about 12 per cent to the US. (Photo | Reuters)

By AFP

SEOUL: South Korea's finance minister warned that an all-out trade war between the US and China would have grim implications for the country, as he lowered this year's growth outlook today.

The world's 11th largest economy is expected to grow 2.9 per cent this year, lower than an earlier estimate of three per cent, Kim Dong-yeon said, citing slowing demand at home and abroad as well as rising unemployment.

The latest estimate is also lower than last year's figures, when the export-reliant economy expanded 3.1 per cent, and comes as the South's top two trading partners China and the US engage in a bitter spat that has seen them impose hefty tariffs on billions of dollars in goods.

"The economic situation down the road does not seem to be bright," Kim told reporters.

"The situation may get worse if anxiety in the international financial markets spreads due to the US-China trade dispute and market and corporate sentiment does not improve," he said.

Overseas shipments account for more than half of the South's economy, with more than a quarter of exports shipped to China and about 12 per cent to the US.

Kim vowed to "closely monitor international trade situations, including the US-China trade row" and announced measures to encourage job creation and spur domestic spending.

US President Donald Trump has taken a confrontational "America First" stance on trade policy, imposing steep tariffs on steel and aluminum, which angered allies and prompted swift retaliation, as well as 25 per cent duties on USD 34 billion of Chinese goods, with more on the way.

China has matched US tariffs dollar-for-dollar and threatened to take further measures, while US exports face retaliatory border taxes from Canada, Mexico and the European Union.

The International Monetary Fund said this week the growing trade confrontation is the "greatest near-term threat to global growth" and in the worst case could cut a half point off world GDP.

Stay up to date on all the latest World news with The New Indian Express App. Download now
(Get the news that matters from New Indian Express on WhatsApp. Click this link and hit 'Click to Subscribe'. Follow the instructions after that.)

Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp