201507

ISSN 2287-7266

ECONOMIC BULLETIN (Republic of Korea)

Republic of Korea

Vol.37 No.7 July 2015

conomic u l l e t i n

Vol.37 No.7 July 2015

The Green Book: Current Economic Trends Policy Issues

Investment Promotion Measures: Tourism, Ventures and Construction Supplementary Budget of 12 Trillion Won Proposed

Economic News Briefing

Foreign Investment Promotion Plans Plan to Boost Competitiveness of Korea’s Exchange Market Government to Improve Household Debt Management Efficiency Korea Allotted 3.81% Share in AIIB

Statistical Appendices

ECONOMIC BULLETIN

(Republic of Korea)

For free subscriptions and enquiries, please contact: International Media Relations Division Ministry of Strategy and Finance Government Complex, 477 Galmae-ro

July 2015

Sejong, 30109 Republic of Korea Tel. +82 2 731 1530 Fax. +82 2 731 1540 E-mail. fppr@mosf.go.kr Website. http://english.mosf.go.kr Economic Information and Education Center Korea Development Institute 263 Namsejong-ro Sejong, 30149 Republic of Korea Fax. +82 44 550 4941 E-mail. jiyounlee@kdi.re.kr Website. http://eb.kdi.re.kr

MOSF / KDI

Tel. +82 44 550 4645

02 The Green Book: Current Economic Trends Overview

03

01. External economic situation

04

02. Private consumption

08

03. Facility investment

11

04. Construction investment

13

05. Exports and imports

15

06. Mining and manufacturing production

18

07. Service sector activity

20

08. Employment

21

09. Financial markets

25

9.1 Stock market

25

9.2 Exchange rate

26

9.3 Bond market

27

9.4 Money supply & money market

28

10. Balance of payments

30

11. Prices

32

11.1 Consumer prices

32

11.2 International oil and commodity prices

34

12. Real estate market 12.1 Housing market

36

12.2 Land market

39

13. Composite indices of business cycle indicators

contents Editor-in-Chief Kim Joo-Hoon (KDI) An Il-Whan (MOSF) Editorial Board Park Joon-Kyu (MOSF) Lee Yong-Soo (KDI) Lee Jae-Yeal (KDI)

36

41

Vol.37 No.7 / july 2015

43 Policy Issues Investment Promotion Measures: Tourism, Ventures and Construction Supplementary Budget of 12 Trillion Won Proposed

49 Economic News Briefing

Coordinators Kim Dae-Hyun (MOSF) Lee Ji-Youn (KDI)

Foreign Investment Promotion Plans

Editors Jeon Aram (MOSF) Kim Hanul (MOSF)

Government to Reform Foreign Exchange Transaction Regulations

Plan to Boost Competitiveness of Korea’s Exchange Market Government to Improve Household Debt Management Efficiency FDI Down 14.2% in First Half of 2015 Korea to Cut Emissions 37% by 2030 Trade Surplus Reaches Record High in First Half of 2015 Korea Allotted 3.81% Share in AIIB Deputy Prime Minister Choi Holds Meeting with Foreign Journalists

53 Statistical Appendices

02

The Green Book : Current Economic Trends

Overview

01. External economic situation

02. Private consumption 03. Facility investment 04. Construction investment 05. Exports and imports 06. Mining and manufacturing production 07. Service sector activity 08. Employment 09. Financial markets 10. Balance of payments 11. Prices 12. Real estate market 13. Composite indices of business cycle indicators

The Green Book: Current Economic Trends

03

ECONOMIC BULLETIN • july 2015

OVERVIEW The Korean economy has seen employment continue to improve, but production and investment are faltering due to weak exports while inflation remains low amid low international oil prices.

Job growth accelerated year-on-year in May from 216,000 in the previous month to 379,000 without bad weather negatively affecting employment.

Consumer price inflation, despite public gas rate cuts and low petroleum product prices, edged up year-onyear in June due to drought, from 0.5 percent in the previous month to 0.7 percent, while core inflation, which excludes oil and agricultural products and is more related to demand, rose 2.0 percent, staying in the 2 percent range.

Mining and manufacturing production fell 1.3 percent month-on-month in May, led by automobiles, semiconductors and machinery. The fall is attributable to fewer days worked due to holidays as well as sluggish exports.

Service output declined 0.4 percent month-on-month in May as weak wholesale & retail and financial & insurance services offset strong transportation and real estate & renting services. Retail sales stayed unchanged, despite strong semi-durable and nondurable goods, as durable goods fell.

Facility investment fell 1.3 percent month-on-month in May, as strong transportation equipment investment was offset by a decline in machinery investment, while construction completed rose 2.0 percent led by building construction.

The composite index of coincident indicators fell in May compared with the previous month, while the composite index of leading indicators improved.

Exports declined at a slower rate year-on-year in June, from 10.9 percent in the previous month to 1.8 percent, backed by strong mobile phones, semiconductors and automobiles. The trade balance posted a surplus of US $10.24 billion.

In June, bond yields rose and the KOSPI edged down amid Greek bailout uncertainty. The Korean won depreciated against both the US dollar and Japanese yen.

Both housing prices and Jeonse (lump-sum deposits with no monthly payments) prices continued to increase month-on-month in June, rising 0.4 percent and 0.5 percent, respectively.

Both internal and external uncertainties are increasing as the MERS outbreak has dampened consumption and service sector activities including tourism & leisure, and the Greek bailout issues are posing another risk.

04

The Green Book : Current Economic Trends

The government will closely examine the effect of the MERS outbreak on the economy, in particular consumption and the service sector, deal with difficulties felt by businesses, and provide financial support for those affected.

The Korean government will implement stimulus measures including a supplementary budget, and will step up efforts to promote investment, encourage exports and revitalize tourism.

The government will continue to monitor internal and external economic developments, including the Greek bailout talks, while reviewing contingency plans to be fully prepared for potential risks.

1. External economic situation Global economic growth has slowed, despite a steady recovery in the US, due to continued slow growth in developing economies and increased uncertainty over a Greek default.

Risks to the global economy remain including the Fed’s expected rate hike later this year causing capital outflows from developing economies, a contracting real estate market leading to slowed growth in China, and contagion from Greece.

US In the US, employment and real estate markets are leading a second quarter economic recovery following a 0.2 percent fall in growth (annualized q-o-q) during the first quarter caused by severe cold weather and other temporary factors.

(Percentage change from previous period)

2012 2013 Annual Annual Q3

2014 Q4 Annual Q1 Q2

Q3

Q4

2015 Q1 Mar Apr May

Real GDP1

2.3

2.2

4.5

3.5

2.4

-2.1

4.6

5.0

2.2 -0.2

-

-

-

- Personal consumption expenditure

1.8

2.4

2.0

3.7

2.5

1.2

2.5

3.2

4.4

2.1

-

-

-

- Nonresidential fixed investment

7.2

3.0

5.5 10.4

6.3

1.6

9.7

8.9

4.7 -2.0

-

-

-

11.9 11.2 -8.5

2.5

-5.3

8.8

3.2

3.8

-

-

-

- Residential fixed investment

13.5

0.5

Industrial production

3.8

2.9

0.6

1.2

4.2

1.0

1.4

1.0

1.1 -0.1

0.0 -0.5 -0.2

Retail sales

4.9

3.9

0.8

0.7

3.8

0.6

2.3

0.8

0.5 -1.0

1.5

0.2

1.2

Existing home sales

8.9

9.0

2.7 -6.3

-3.0

-5.1

4.5

3.5

0.1 -1.7

6.5 -2.3

5.1

Unemployment rate²

8.1

7.4

7.2

7.0

6.2

6.6

6.2

6.1

5.7

5.5

5.4

5.5

Consumer prices (y-o-y)

2.1

1.5

1.5

1.2

1.6

1.4

2.1

1.8

1.2 -0.1 -0.1 -0.2

0.0

1. Annualized rate (%) 2. Seasonally adjusted Sources: US Department of Commerce, Bloomberg

5.6

05

ECONOMIC BULLETIN • july 2015

Industrial production in May fell due to slow global economic growth and weak energy sector investment amid falling oil prices, but the ISM manufacturing index rose for the third consecutive month due to the improving business environments in the manufacturing sector excluding the energy industry.

ISM Manufacturing Index (base=50) 57.9 (Oct 2014) → 57.6 (Nov) → 55.1 (Dec) → 53.5 (Jan 2015) → 52.9 (Feb) → 51.5 (Mar) → 51.5 (Apr) → 52.8 (May) → 53.5 (Jun)

US GDP growth and industrial production 10

Sources: US Department of Commerce, Federal Reserve Board

(%)

8 6 4 2 0 -2 -4 -6 -8 -10 2004.Q1

2005.Q1

2006.Q1

2007.Q1

2008.Q1

2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

GDP (q-o-q, annualized rate)

2014.Q1

2015.Q1

Industrial production (q-o-q)

Retail sales rose 1.2 percent month-on-month in May led by increased car sales (up 2.0%) amid low oil prices, and consumer sentiment improved in June.

University of Michigan Consumer Sentiment Index (1966=100) 86.9 (Oct 2014) → 88.8 (Nov) → 93.6 (Dec) → 98.1 (Jan 2015) → 95.4 (Feb) → 93.0 (Mar) → 95.9 (Apr) → 90.7 (May) → 96.1 (Jun) Conference Board Consumer Confidence Index (1985=100) 94.1 (Oct 2014) → 91.0 (Nov) → 93.1 (Dec) → 103.8 (Jan 2015) → 98.8 (Feb) → 101.4 (Mar) → 94.3 (Apr) → 94.6 (May) → 101.4 (Jun)

The housing market improved as home prices continued to rise (up 4.9%, y-o-y) and new (up 2.2%, m-o-m) and existing home sales (up 5.1%, m-o-m) both increased in May. Case-Shiller Home Price Index (y-o-y, %) 4.8 (Sep 2014) → 4.4 (Oct) → 4.3 (Nov) → 4.4 (Dec) → 4.5 (Jan 2015) → 4.9 (Feb) → 5.0 (Mar) → 4.9 (Apr) Existing home sales (m-o-m, %) -1.4 (Aug 2014) → 2.0 (Sep) → 1.2 (Oct) → -4.1 (Nov) → 2.4 (Dec) → -4.9 (Jan 2015) → 1.5 (Feb) → 6.5 (Mar) → 3.3 (Apr) → 5.1 (May)

Nonfarm payroll growth accelerated, adding 254,000 jobs in May, compared with 187,000 in April.

Nonfarm payroll increase (m-o-m, thousands) 221 (Oct 2014) → 423 (Nov) → 329 (Dec) → 201 (Jan 2015) → 266 (Feb) → 119 (Mar) → 187 (Apr) → 254 (May)

06

The Green Book : Current Economic Trends

US nonfarm payroll growth and unemployment rate Source: US Department of Labor 800

(thousands)

(%)

12

600 10 400 200

8

0 6 -200 4

-400 -600

2 -800 0

-1,000 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

US nonfarm payroll growth (m-o-m, left)

2014.1

2015.1

Unemployment rate (right)

China In China, while main economic indicators, such as industrial production, retail sales and exports, showed some improvement, there are concerns over financial instability following a recent sharp decline in the stock market.

The People’s Bank of China cut both its benchmark interest rate and the reserve requirement for banks with sizable lending to farmers and small businesses on June 27, and later announced measures to stabilize the stock market, relaxing rules on margin financing on July 1 and suspending IPOs on July 3.

Manufacturing PMI (base=50) 50.8 (Oct 2014) → 50.3 (Nov) → 50.1 (Dec) → 49.8 (Jan 2015) → 49.9 (Feb) → 50.1 (Mar) → 50.1 (Apr) → 50.2 (May) → 50.2 (Jun)

China’s GDP growth and fixed asset investment

Source: China National Bureau of Statistics

18

70 (%)

(%)

16

60

14

50

12

40

10

30

8

20

6

10

4

0

2004.Q1

2005.Q1

GDP (y-o-y, left)

2006.Q1

2007.Q1

2008.Q1

2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

Fixed asset investment (accumulated, y-o-y, right)

07

ECONOMIC BULLETIN • july 2015

(Percentage change from same period in previous year)

Real GDP Industrial production Fixed asset investment (accumulated) Retail sales Exports Consumer prices1 Producer prices1

2012 2013 Annual Annual Q4 7.7 7.7 7.7 10.0 9.7 10.0 20.6 19.6 19.6 14.3 13.1 13.5 8.3 8.6 7.5 2.6 2.6 2.9 -1.7 -1.9 -1.4

Q1 7.4 8.7 17.6 12.0 -3.5 2.3 -2.0

2014 Q2 Q3 7.5 7.3 8.9 8.0 17.3 16.1 12.3 11.9 5.0 13.0 2.2 2.0 -1.5 -1.3

2015 Q1 Mar Apr 7.0 6.4 5.6 5.9 13.5 13.5 12.0 10.6 10.2 10.0 4.7 -15.0 -6.4 1.2 1.4 1.5 -4.6 -4.6 -4.6

Q4 7.3 7.6 15.7 11.7 8.6 1.5 -2.7

May 6.1 11.4 10.1 -2.5 1.2 -4.6

1. Quarterly change: average of monthly change Source: China National Bureau of Statistics

Japan Japan’s economic recovery slowed despite increased retail sales in May as export growth slowed and industrial production fell.

Consumer price growth slowed slightly in May, as consumer prices increased 0.5 percent year-on-year (0.1% excluding fresh food).

The Japanese government announced, on June 30, its national fiscal reform plan and growth strategies for the next three years to achieve fiscal soundness and raise productivity.

(Percentage change from previous period)

Real GDP Industrial production Retail sales Exports (y-o-y) Consumer prices (y-o-y)

2012 2013 Annual Annual Q4 1.8 1.6 -0.3 0.2 -0.6 1.8 1.5 1.2 1.4 -2.7 9.5 17.4 -0.0 0.4 1.4

Annual -0.1 2.1 1.7 4.8 2.7

Q1 1.2 2.3 3.8 6.6 1.5

2014 Q2 -1.8 -3.1 -7.2 0.1 3.6

Q3 -0.5 -1.3 3.9 3.2 3.3

Q4 0.3 0.8 1.0 9.1 2.6

Q1 1.0 1.6 -2.1 9.0 2.3

2015 Mar Apr -0.8 1.2 -1.8 0.3 8.5 8.0 2.3 0.6

May -2.2 1.7 2.4 0.5

Sources: Japan's Cabinet Office, Ministry of Economy, Trade and Industry, Ministry of Finance, Statistics Bureau of Japan

Japan’s GDP growth and industrial production 6

Source: Japan's Cabinet Office, Ministry of Economy, Trade and Industry

(%)

(%)

4

25 20 15 10

2

5 0

0

-5 -2

-10 -15

-4

-20 -25

-6 2004.Q1

2005.Q1

GDP (q-o-q, left)

2006.Q1

2007.Q1

2008.Q1

2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

Industrial production (q-o-q, right)

08

The Green Book : Current Economic Trends

Eurozone The Eurozone economy showed signs of recovery as economic indicators improved, including industrial production and retail sales, due to quantitative easing by the ECB and a weak euro, but risk factors remain such as a Greek default.

Manufacturing PMI (base=50) 50.6 (Oct 2014) → 50.1 (Nov) → 50.6 (Dec) → 51.0 (Jan 2015) → 51.0 (Feb) → 52.2 (Mar) → 52.0 (Apr) → 52.2 (May) → 52.5 (Jun)

(Percentage change from previous period)

2012 2013 Annual Annual Q3

Q4 Annual Q1

2014 Q2

Q3

Q4

Q1

Feb

2015 Mar

Apr

May

Real GDP

-0.7

-0.4

0.2

0.2

0.9

0.3

0.1

0.2

0.3

0.4

-

-

-

-

Industrial production

-2.4

-0.7

0.0

0.6

0.8

0.1

0.2

-0.2

0.4

0.9

1.0

-0.4

0.1

-

Retail sales

-1.7

-0.8

0.6

-0.4

1.3

0.6

0.5

0.2

0.8

0.7

0.1

-0.6

0.7

-

Exports (y-o-y)

7.7

1.1

0.3

1.0

2.3

1.0

0.6

2.9

4.4

5.0

4.3

10.9

8.8

-

Consumer prices (y-o-y)

2.5

1.4

1.3

0.8

0.4

0.7

0.6

0.4

0.2

-0.3

-0.3

-0.1

0.0

0.3

Sources: Eurostat, Bloomberg

Eurozone’s GDP growth and industrial production 3

Source: Eurostat

(%)

10

(%)

8

2

6 4

1

2 0

0

-2 -1

-4 -6

-2

-8 -10

-3 2004.Q1

2005.Q1

2006.Q1

2007.Q1

2008.Q1

2009.Q1

2010.Q1

GDP (q-o-q, left)

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

Industrial production (q-o-q, right)

2. Private consumption Private consumption in the first quarter of 2015 (preliminary GDP) rose 0.6 percent compared to the previous quarter and 1.5 percent compared to a year ago.

09

ECONOMIC BULLETIN • july 2015

(Percentage change from previous period)

2012 Annual Annual Private consumption²

Q1

2013 Q2

Q3

Q4

Annual

Q1

20141 Q2

Q3

Q4

20151 Q11

1

1.9

1.9

-0.1

0.5

1.1

0.6

1.8

0.4

-0.4

0.8

0.5

0.6

-

-

1.6

1.9

1.9

2.2

-

2.6

1.7

1.5

1.4

1.5

(y-o-y) 1. Preliminary 2. National accounts Source: The Bank of Korea

Private consumption 12

Source: The Bank of Korea (national accounts)

(%)

10 8 6 4 2 0 -2 -4 -6 2004.Q1

2005.Q1

2006.Q1

2007.Q1

2008.Q1

2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

Private consumption (q-o-q)

2014.Q1

2015.Q1

Private consumption (y-o-y)

Retail sales in May stayed flat compared with the previous month and rose 3.5 percent year-on-year as durable goods (down 1.1%), such as household appliances, decreased, while semi-durable goods (up 0.8%), such as clothing, and nondurable goods (up 0.3%), such as fuel, both increased.

Retail sales 20

Source: Statistics Korea (industrial activity trends)

(%)

15

10

5

0

-5 -10 2004.1

2005.1

Retail sales (m-o-m)

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

Retail sales (y-o-y)

10

The Green Book : Current Economic Trends

(Percentage change from previous period)

2012 2013 Annual Annual Q3

Q4

Annual

Q1

2014 Q2

Q3

Q4

Q1

2015 Apr¹

May¹

Retail sales

-

-

0.8

0.4

-

0.2

-0.2

1.3

0.4

0.5

1.4

0.0

(y-o-y)

2.5

0.7

0.5

1.1

1.7

2.4

0.8

1.5

1.9

1.6

4.9

3.5

- Durable goods²

5.4

0.3

-0.3

0.2

5.1

3.8

-0.2

1.8

1.3

5.2

0.5

-1.1

· Automobiles

2.4

2.1

2.1

-2.1

16.6

9.8

5.3

1.2

6.3

3.9

-1.4

5.2

- Semi-durable goods³

-0.3

2.1

0.7

-0.4

-0.6

-1.4

-1.1

4.8

-1.8

-3.5

2.9

0.8

- Nondurable goods4

2.2

0.4

1.5

0.8

0.8

-0.9

0.2

-0.7

1.0

-0.5

1.5

0.3

1. Preliminary 2. Durable goods: Automobiles, electronic appliances, furniture, telecommunications devices, etc.

3. Semi-durable goods: Clothing, footwear, etc. 4. Nondurable goods: Food, medicine, cosmetics, fuel, tobacco, etc.

Source: Statistics Korea

Retail sales by type 50

Source: Statistics Korea (industrial activity trends)

(y-o-y, %)

40 30 20 10 0 -10 -20 -30 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

Durable goods

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

Nondurable goods

Semi-durable goods

Retail sales are likely to fall in June compared to the previous month due to the impact of the MERS outbreak on sales at department stores and large discount stores as well as domestic sales of gasoline. (y-o-y, %)

2014

2015

Nov

Dec

Jan

Feb

Mar

Apr

May

Jun

Credit card use

5.3

8.7

3.1

10.0

5.7

15.3

7.1

8.6

Department store sales

-6.5

-0.9

-11.0

6.6

-5.7

1.3

3.1

-10.7

Large discount store sales

-4.7

-3.8

-18.3

24.5

-6.5

0.0

0.5

-9.7

Domestic sales of gasoline

-1.0

-0.4

7.3

12.1

8.6

9.6

3.3

-2.9

Domestic sales of cars

7.0

27.2

3.9

-3.8

5.5

2.8

-0.2

9.4

Sources: Credit Finance Association of Korea, Ministry of Trade, Industry and Energy, Korea National Oil Corporation, Korea Automobile Manufacturers Association

11

ECONOMIC BULLETIN • july 2015

3. Facility investment Facility investment (preliminary GDP) rose 0.2 percent quarter-on-quarter and 5.8 percent year-on-year in the first quarter of 2015.

(Percentage change from previous quarter)

2012 Annual

Annual

2013 Q3

0.1

-0.8

-

-

- Machinery

0.3

- Transportation equipment

-0.4

Facility investment² (y-o-y)

Q4

Annual

Q1

2014 Q2

Q3

Q4

2015 Q1¹

3.5

4.2

5.8

-1.4

1.3

0.2

4.0

2.3

11.6

-

7.2

7.7

4.2

4.2

0.2 5.8

-2.3

6.3

2.3

5.0

-3.4

0.4

2.0

5.6

-0.7

3.1

-3.5

9.1

7.7

3.7

3.6

-3.8

0.4

2.4

2014.Q1

2015.Q1

1. Preliminary 2. National accounts Source: The Bank of Korea

Facility investment 40

Source: The Bank of Korea (national accounts)

(%)

30 20 10 0 -10 -20 -30 2004.Q1

2005.Q1

2006.Q1

2007.Q1

2008.Q1

2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

Facility investment (q-o-q)

Facility investment (y-o-y)

The facility investment index in May declined 1.3 percent month-on-month as a decrease in machinery investment offset an increase in transportation equipment investment. The index rose 0.8 percent year-on-year.

(Percentage change from previous quarter)

2013 Annual Annual Facility investment index

Q1

2014 Q2

Q3

Q4

Q1

Jan

2015 Feb Mar

Apr1

May1 -1.3

-0.8

5.2

-4.0

1.7

-0.9

8.6

-1.6

-7.7

3.4

-2.0

-1.7

-

-

7.5

6.7

1.5

5.4

8.4

13.7

3.1

8.8

2.6

0.8

- Machinery

-2.1

3.9

-6.1

0.9

-0.8

11.7

-1.3

-2.8

-1.8

0.9

-2.8

-8.3

- Transportation equipment

2.8

8.8

1.6

3.6

-1.4

1.5

-2.4

-19.8

19.2

-10.0

1.4

17.2

(y-o-y)

1. Preliminary Source: Statistics Korea

12

The Green Book : Current Economic Trends

Facility investment by type Source: The Bank of Korea (national accounts) 50

(y-o-y, %)

40 30 20 10 0 -10 -20 -30 2004.Q1

2005.Q1

2006.Q1

2007.Q1

2008.Q1

2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

Transportation equipment

2015.Q1

Machinery

Although the Korea Development Bank survey showed a positive outcome regarding corporate facility investment, the facility investment outlook is mixed due to weakening business sentiment amid sluggish exports and the MERS outbreak, and poor manufacturing operation ratios.

Facility investment plans (y-o-y, %, 2,500 companies, surveyed by Korea Development Bank) -0.6 (2013) → 5.1 (2014) → 7.21 (2015) 1. Estimate

Business survey index for manufacturing sector (Bank of Korea) 78 (Oct 2014) → 74 (Nov) → 75 (Dec) → 77 (Jan 2015) → 73 (Feb) → 82 (Mar) → 80 (Apr) → 82 (May) → 76 (Jun) → 67 (Jul)

Leading indicators of facility investment Sources: Statistics Korea (machinery orders), Korea International Trade Association (machinery imports) 10

70

(trillion won)

60

9

50 8

40 30

7

20 6

10 0

5

-10 4

-20 -30

3

-40 2

-50

2004.Q1

2005.Q1

Machinery orders (left)

2006.Q1

2007.Q1

2008.Q1

2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

Machinery imports (right)

13

ECONOMIC BULLETIN • july 2015

(Percentage change from same period in previous year)

Domestic machinery orders

2013 Annual Annual 6.6 14.8

(q-o-q, m-o-m)

Q1 18.5

2014 Q2 4.0

Q3 49.4

Q4 -6.3

Q1¹ -2.6

Jan 32.9

2015 Feb Mar 0.5 -24.9

Apr¹ 22.2

May¹ 15.1

-

-

-2.0

-11.3

45.2

-26.0

6.2

31.9

-17.8

16.7

18.8

-24.4

-Public

20.5

94.2

184.6

-45.0

418.5

-27.6

-66.9

32.0

17.6

-85.4

30.7

66.3

-Private

5.1

4.8

4.7

9.1

7.7

-2.0

12.0

33.0

-0.7

5.5

21.8

11.6

Machinery imports

1.1

5.8

2.5

11.9

1.7

7.0

8.4

14.0

3.1

8.7

-5.9

-6.0

Average manufacturing operation ratio

76.5

76.1

77.1

76.1

76.0

75.1

74.3

74.1

75.1

73.9

74.1

73.4

Facility investment adjustment pressure²

-0.9

-1.5

-0.7

-1.1

-0.5

-3.5

-2.6

0.3

-6.5

-1.5

-4.2

-4.0

1. Preliminary 2. Production growth rate minus production capacity growth rate in the manufacturing sector (%p) Sources: Statistics Korea, Korea International Trade Association

4. Construction investment Construction investment in the first quarter of 2015 (preliminary GDP) rose 7.4 percent quarter-on-quarter and 0.6 percent year-on-year.

(Percentage change from previous quarter)

2012 Annual Annual -3.9 5.5 -1.6 11.2 -7.1 -2.5

Construction investment² (y-o-y) - Building construction - Civil engineering works

2013 Q3 -0.8 7.4 0.2 -2.5

Q4 -4.8 3.5 -3.3 -7.2

Annual 1.0 4.4 -4.4

Q1 5.3 4.1 3.2 8.9

2014 Q2 0.5 0.2 3.1 -3.8

Q3 0.9 2.3 2.4 -1.8

Q4 -7.8 -1.5 -7.3 -8.8

2015 Q1¹ 7.4 0.6 4.5 12.7

1. Preliminary 2. National accounts Source: The Bank of Korea

Construction investment

Source: The Bank of Korea (national accounts)

(%) 10

5

0

-5

-10 2004.Q1

2005.Q1

2006.Q1

Construction investment (q-o-q)

2007.Q1

2008.Q1

2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

Construction investment (y-o-y)

14

The Green Book : Current Economic Trends

The value of construction completed (constant) in May rose 2.0 percent month-on-month helped by an increase in building construction, notwithstanding a decrease in civil engineering works. The index declined 4.9 percent year-on-year.

(Percentage change from previous period)

2013 Annual Annual Construction completed (constant) (y-o-y) - Building construction - Civil engineering works

Q1

2014 Q2

Q3

Q4

Q1

Jan

2015 Feb Mar

Apr1

May¹

10.2

-0.8

1.0

-0.4

-2.7

-3.9

4.8

4.3

4.9

-7.2

-2.1

2.0

-

-

6.6

0.1

-1.9

-5.9

-2.0

-4.4

0.2

-1.8

-8.4

-4.9

15.1

7.8

4.8

2.0

-3.8

-3.7

5.0

5.7

4.1

-6.9

-3.1

6.8

4.4

-12.3

-4.6

-4.1

-0.8

-4.2

4.5

2.0

6.1

-7.7

-0.5

-5.7

1. Preliminary Source: Statistics Korea

Construction investment by type Source: The Bank of Korea (national accounts) 40

(y-o-y, %)

30

20

10

0

-10

-20 -30 2004.Q1

2005.Q1

2006.Q1

2007.Q1

2008.Q1

Building construction

2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

Residential buildings

2014.Q1

2015.Q1

Civil engineering works

Construction investment is expected to rise, considering increases in new apartment sales and buildings under construction.

Unsold houses (thousand, Ministry of Land, Infrastructure and Transport) 40 (Oct 2014) → 40 (Nov) → 40 (Dec) → 37 (Jan 2015) → 34 (Feb) → 29 (Mar) → 28 (Apr) → 28 (May) New apartment sales (thousand, Ministry of Land, Infrastructure and Transport) 64 (Oct 2014) → 43 (Nov) → 17 (Dec) → 15 (Jan 2015) → 9 (Feb) → 33 (Mar) → 55 (Apr) → 59 (May) → 551 (Jun) 1. Estimate

Buildings under construction (y-o-y, %, floor area) 42.9 (Oct 2014) → 8.6 (Nov) → -29.8 (Dec) → 45.2 (Jan 2015) → -0.9 (Feb) → 29.6 (Mar) → 20.5 (Apr) → 46.0 (May)

15

ECONOMIC BULLETIN • july 2015

(Percentage change from same period in previous year)

2013 Annual Annual Construction orders (current value)

-12.9

(q-o-q, m-o-m)

15.3

Q1

2014 Q2

Q3

Q4

Q1

Jan

2015 Feb Mar

Apr1

May1

15.5

25.4

42.8

-7.5

55.4

30.5

-3.3

150.0

20.6

84.5

-

-

-5.1

12.4

22.0

-29.0

50.9

37.6

-16.6

74.2

-24.5

37.8

- Building construction

-10.2

24.5

11.2

45.6

61.8

-5.0

87.7

75.1

3.1

178.4

34.1

97.8

- Civil engineering works

-18.2

-4.4

24.0

-11.5

-6.2

-13.1

-1.5

-39.1

-12.5

76.3

-7.1

27.8

-7.3

11.2

18.4

21.6

14.7

-4.6

11.0

36.8

-20.6

28.3

20.3

26.5

Building permits²

1. Preliminary 2. Floor area Sources: Statistics Korea, Ministry of Land, Infrastructure and Transport

Leading indicators of construction investment Sources: Statistics Korea (construction orders), Ministry of Land, Infrastructure and Transport (building permit area) 300 250 200 150 100 50 0 -50 -100 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

Construction orders

2014.1

2015.1

Building permit area

5. Exports and imports Exports in June declined 1.8 percent (preliminary) year-on-year to US $46.95 billion.

Exports improved compared with a 10.9 percent drop in the previous month, backed by more days worked (2.5 days) and strong mobile phones.

(US $ billion)

Exports (y-o-y, %) Average daily exports 1. Preliminary Source: Korea Customs Service

2013 2014 Annual Annual Q1 Q2 Q3 Q4 559.63 572.66 137.53 145.67 141.76 147.70 2.1 2.3 1.6 3.2 3.6 0.9 2.05 2.11 2.07 2.19 2.07 2.13

Jun 47.83 2.4 2.28

2015 Q1 Q2 May 133.45 135.56 42.37 -3.0 -6.9 -10.9 2.01 1.99 2.07

Jun1 46.95 -1.8 2.00

16

The Green Book : Current Economic Trends

By item, exports rose mostly, with exceptions of petrochemicals, petroleum products and vessels. By region, shipments to the US, China and the ASEAN countries rose, whereas shipments to the EU, Japan and Latin America continued to fall.

Export growth by item (y-o-y, %) 17.9 (mobile phones), 7.6 (steel), 6.5 (automobiles), 3.4 (semiconductors), -12.8 (petrochemicals), -14.4 (petroleum products), -17.1 (vessels) Export growth by region (y-o-y, %) 11.0 (US), 9.8 (ASEAN countries), 0.8 (China), -4.3 (EU), -7.9 (Middle East), -12.7 (Japan), -20.4 (Latin America)

Average daily exports, an indicator adjusted to days worked, was down 12.3 percent year-on-year, posting US $2.00 billion in June.

Exports by item 160 140

Sources: Korea Customs Service, Ministry of Trade, Industry and Energy (export and import trends)

(y-o-y, %)

120 100 80 60 40 20 0 -20 -40 -60 -80 2004.1

2005.1

2006.1

2007.1

Export growth rate

2008.1

2009.1

2010.1

2011.1

Semiconductors

2012.1

2013.1

2014.1

2015.1

Automobiles

Steel

Imports in June fell 13.6 percent (preliminary) year-on-year to US $36.70 billion.

Capital and consumer goods were on the rise in June, while commodity imports continued to decline.

Import growth by category (May à Jun, y-o-y, %) -24.7 → -26.0 (commodities), -3.4 → 3.2 (capital goods), 2.4 → 5.6 (consumer goods) (US $ billion)

2013 Imports

2014

2015

Annual

Annual

Q1

Q2

Q3

Q4

Jun

Q1

Q2

May

Jun1

515.59

525.51

132.37

130.96

132.84

129.35

42.48

111.80

110.48

36.07

36.70

(y-o-y, %)

-0.8

1.9

2.0

3.3

5.4

-2.8

4.3

-15.5

-15.6

-15.4

-13.6

Average daily imports

1.89

1.94

1.99

1.97

1.94

1.86

2.02

1.68

1.62

1.76

1.56

1. Preliminary Source: Korea Customs Service

17

ECONOMIC BULLETIN • july 2015

Imports by item 100

Sources: Korea Customs Service, Ministry of Trade, Industry and Energy (export and import trends)

(y-o-y, %)

80 60 40 20 0 -20 -40 -60 -80 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

Import growth rate

2010.1

2011.1

2012.1

2013.1

2014.1

Commodities

Exports and imports

2015.1

Capital goods

Sources: Korea Customs Service, Ministry of Trade, Industry and Energy (export and import trends)

60 (US $ billion) 50

40

30

20

10

0 -10 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

Trade balance

2011.1

2012.1

2013.1

2014.1

Exports

2015.1

Imports

The trade balance (preliminary) grew at a faster pace in June, posting a surplus of US $10.24 billion, and stayed in the black for the 41st consecutive month.

(US $ billion)

2013 Trade balance 1. Preliminary Source: Korea Customs Service

2014

2015

Annual

Annual

Q1

Q2

Q3

Q4

Jun

Q1

Q2

May

Jun1

44.05

47.15

5.17

14.72

8.92

18.35

5.35

21.66

25.08

6.30

10.24

18

The Green Book : Current Economic Trends

6. Mining and manufacturing production Mining and manufacturing production fell 1.3 percent month-on-month in May as strong communications equipment and refined petroleum were offset by weak automobiles and semiconductors.

Compared to the same period of the previous year, the index fell 2.8 percent.

Compared to the previous month, production of communications equipment (up 22.1%), refined petroleum (up 3.0%) and primary metals (up 1.4%) rose, while production of automobiles (down 3.7%), semiconductors (down 4.8%) and machinery (down 4.4%) decreased.

Compared to a year ago, production of semiconductors (up 17.4%), refined petroleum (up 2.6%) and nonmetallic minerals (up 2.0%) rose, while machinery (down 9.5%), other transportation equipment (down 15.4%) and electronic parts (down 7.4%) declined.

Industrial production Source: Statistics Korea (industrial activity trends) 50

(%)

40 30 20 10 0 -10 -20 -30 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

Industrial production (m-o-m)

2014.1

2015.1

Industrial production (y-o-y)

(Percentage change from previous period)

2013 Annual Annual

Q1

2014 Q2

Q3

Q4

Q1¹

Feb

2015 Mar¹ Apr¹ May¹

Mining (q-o-q, m-o-m)

-

-

-0.3

-0.6

0.1

-0.9

-0.1

2.3

-0.2

-1.3

-1.3

(y-o-y)

0.7

0.0

0.7

0.5

1.2

-1.9

-0.9

-5.0

0.1

-2.6

-2.8

-

-

-0.2

-0.7

0.1

-1.0

0.0

2.5

-0.3

-1.3

-1.5

Manufacturing (q-o-q, m-o-m) Mining and (y-o-y) manufacturing Shipment activity²

0.7

0.1

0.7

0.4

1.2

-1.9

-1.0

-5.1

0.1

-2.7

-2.8

0.7

0.0

-0.3

-0.3

-0.4

0.0

-0.6

0.5

0.3

-0.5

-1.2

- Domestic consumption

-0.8

0.3

-0.4

-0.2

-0.9

-0.8

0.5

2.7

-0.7

1.1

-1.4

- Exports

2.6

-0.4

-0.1

-0.3

0.1

1.1

-2.0

-2.0

1.3

-2.3

-0.9

Inventory³

4.4

-1.8

-0.3

0.6

0.9

-2.2

3.5

2.8

0.8

2.5

-1.1

Manufacturing Average operation ratio (%) indicators Production capacity (y-o-y)

76.5

76.1

77.1

76.1

76.0

75.1

74.4

75.1

73.9

74.1

73.4

1.6

1.6

1.4

1.5

1.7

1.6

1.5

1.4

1.6

1.5

1.2

1. Preliminary 2. Including mining, manufacturing, electricity and gas industry 3. End-period

19

ECONOMIC BULLETIN • july 2015

The manufacturing inventory-shipment ratio rose 0.1 percentage points month-on-month to 127.3 percent as inventories fell 1.1 percent and shipments declined 1.2 percent.

Inventories of automobiles (up 1.1%), chemicals (up 0.5%) and shoes & leather products (up 4.8%) rose, while refined petroleum (down 6.4%), groceries (down 6.1%) and electronic parts (down 3.4 %) declined.

Shipments of communications equipment (up 18.6%), nonmetallic minerals (up 6.6%) and refined petroleum (up 1.7%) rose, while semiconductors (down 4.8%), chemicals (down 3.5%) and machinery (down 3.9%) fell.

The average operation ratio of the manufacturing sector fell 0.7 percentage points month-on-month to 73.4 percent.

Shipment and inventory 10 8

Source: Statistics Korea (industrial activity trends)

(m-o-m, %)

6 4 2 0 -2 -4 -6 -8 -10 -12 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

Shipment growth

Inventory growth

Average manufacturing operation ratio 100

2015.1

Source: Statistics Korea (industrial activity trends)

(%)

90

80

70

60

50 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

Mining and manufacturing production is expected to improve year-on-year in June due to the completion of regular maintenance in petrochemical plants as well as a low base effect from a year ago, despite weak consumption in the aftermath of the MERS outbreak.

20

The Green Book : Current Economic Trends

7. Service sector activity Service output in May declined 0.4 percent month-on-month, as gains in entertainment, cultural & sports services and transportation services were offset by declines in hotels & restaurants and financial & insurance services. Compared to the same period of the previous year, service output rose 2.4 percent.

Wholesale & retail (down 1.3%, m-o-m) and hotels & restaurants (down 1.1%, m-o-m) have been fluctuating monthly, while financial & insurance services (down 0.7%, m-o-m) declined for the first time in four months.

Real estate & renting (up 1.5%, m-o-m) rose for the third consecutive month, while entertainment, cultural & sports services rose for the first time in three months.

Service sector activity 15

Source: Statistics Korea (industrial activity trends)

(%)

10

5

0

-5

-10 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

Service sector activity (m-o-m)

2014.1

2015.1

Service sector activity (y-o-y)

(Percentage change from previous period)

2012 2013 Weight Annual Annual Q4 Service activity index - Wholesale & retail

100.0

1.6

1.5

Annual

2014 Q1 Q2

Q3

Q4

2015 Q1 Apr1 May1

0.9

1.0

0.5

0.5 -0.4 1.2 -1.3

0.8

2.2

0.7

0.1

21.6

0.8

0.1

0.8

-0.2

-0.4 -0.5

0.1

0.1

0.5

- Transportation services

8.5

1.2

1.0

-0.3

1.7

0.8

0.6

2.6

0.1 -0.7

- Hotels & restaurants

7.2

-1.2

0.5

0.9

1.2

0.2 -1.5

- Publishing & communications services

0.7

2.6 -1.2 -0.5

1.2

1.0 -1.1

8.4

3.0

2.2

3.0

1.8

-1.2

0.9 -0.2

0.1 -2.7 -1.6 -0.3

14.7

2.8

0.5

0.5

5.2

2.5

1.2

2.1

2.9

- Real estate & renting

5.3

-4.8

2.5

2.7

6.2

0.2

4.4

0.0

3.6 -2.1

3.0

- Professional, scientific & technical services

5.6

3.7

3.3

0.4

2.3

0.1

2.6 -1.1

2.0 -2.9

0.6 -3.2

- Business services

3.3

3.5

2.1

0.4

2.4

1.5 -0.6

0.3

1.0

- Education services

10.9

0.9

0.8

0.3

1.3

1.6 -1.9

1.1

0.0

0.8 -0.1 -0.5

- Healthcare & social welfare services

7.5

6.7

5.2

1.7

6.3

1.4

1.4

2.7

2.1 -0.3 -0.3

- Entertainment, cultural & sports services

2.9

2.8

-0.7

-0.4

-1.1

0.0 -4.7

- Membership organizations & personal services - Sewerage & waste management

3.6

-1.4

6.1

-1.0

-0.6

0.6

-0.6

-0.4

1.2

1.0

- Financial & insurance services

1. Preliminary Source: Statistics Korea

1.0

2.7

0.7 -0.7 1.5

1.9 -1.4 -0.5

6.1 -2.1

2.6 -2.0

1.1 -1.0

0.5 -3.8

1.8

3.7 -1.6

0.2 -1.4

1.6

1.8

2.6

1.1

6.8 1.5

21

ECONOMIC BULLETIN • july 2015

Wholesale & retail 15

Statistics Korea (industrial activity trends)

(%)

10

5

0

-5

-10 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

Wholesale & retail (m-o-m)

10

2015.1

Wholesale & retail (y-o-y)

May 2015 service output by business 12

2014.1

Source: Statistics Korea (industrial activity trends)

(y-o-y, %)

8 6 4

Transportation services

Total index

2

Professional, scientific & technical services

Publishing & communications services

Education services

Membership organizations & personal services

0 -2

Wholesale & retail

-4

Hotels & restaurants

-6

Real estate & renting

Financial & insurance services

Business services

Health & social welfare services

Entertainment, cultural & sports services

Sewerage & waste management

-8 -10 -12

The service output outlook for June is negative, as department store and discount store sales fell and the number of incoming tourists declined following the MERS outbreak.

Foreign tourist arrivals (daily average, thousands) 44.3 (May 2015) → 37.11 (1st week June) → 25.71 (2nd week) → 21.41 (3rd week) → 17.11 (4th week) 1. Preliminary Source: Ministry of Justice

8. Employment The number of workers on payroll in May increased by 379,000 from a year earlier to 26,190,000 and the employment rate rose 0.1 percentage points to 60.9 percent.

22

The Green Book : Current Economic Trends

By industry, services and manufacturing continued to lead employment growth.

By employment status, permanent workers continued to lead employment growth, while temporary and daily workers rose at a faster pace and self-employed workers increased for the first time in six months.

Number of persons employed and employment growth 1,000

Source: Statistics Korea (employment trends)

(thousands)

27

(millions)

800

26

600 25 400 24 200 23

0

22

-200 -400

21

2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

Employment growth (y-o-y, left)

Number of employed (millions) Employment rate (%) (Seasonally adjusted) Employment growth (y-o-y, thousands) (Excluding agriculture, forestry & fisheries) - Manufacturing - Construction - Services - Agriculture, forestry & fisheries - Wage workers 路 Permanent workers 路 Temporary workers 路 Daily workers - Nonwage workers 路 Self-employed workers - Male - Female - 15 to 29 - 30 to 39 - 40 to 49 - 50 to 59 - 60 or more Source: Statistics Korea

2012.1

2013.1

2014.1

2015.1

Number of employed (seasonally adjusted, right)

2011 Annual 24.24 59.1 59.1 415 440 63 -2 386 -25 427 575 -78 -70 -11 1 238 177 -35 -47 57 291 149

2012 Annual 24.68 59.4 59.4 437 451 14 22 416 -14 315 436 -2 -120 121 124 234 203 -36 -31 11 270 222

Annual 25.07 59.5 59.5 386 394 79 -19 318 -8 483 615 -96 -37 -97 -67 186 200 -50 -21 22 254 181

2013 Q3 25.41 60.3 59.7 421 402 26 4 354 19 526 632 -65 -42 -105 -83 179 242 -41 -34 30 279 187

Q4 25.35 60.0 59.9 541 556 49 -9 507 -15 604 637 2 -35 -63 -54 262 279 46 -42 53 285 200

Annual 25.60 60.2 60.2 533 601 146 42 424 -68 548 443 140 -35 -15 1 266 267 77 -21 38 239 200

Q1 24.91 58.8 60.4 729 717 123 27 570 12 711 606 74 31 19 -7 373 357 97 -6 99 323 218

2014 Q2 Q3 25.79 25.93 60.8 60.9 59.9 60.3 464 517 518 638 136 194 12 57 387 403 -54 -121 485 519 478 333 118 226 -111 -40 -22 -3 -14 19 228 268 236 249 53 102 -42 -7 34 15 227 215 192 192

Q4 25.77 60.4 60.3 422 531 129 72 336 -109 476 355 141 -20 -54 7 196 226 56 -29 4 190 201

May 25.81 60.8 59.7 413 471 148 14 327 -58 437 441 121 -125 -24 -31 200 212 23 -42 22 227 182

Q1 25.27 59.0 60.5 354 441 139 72 222 -87 442 355 82 4 -88 -49 141 213 32 -1 -47 177 192

2015 Apr 25.90 60.3 60.0 216 351 167 63 108 -135 347 300 -31 78 -131 -57 121 95 85 -68 -26 112 114

May 26.19 60.9 59.9 379 501 140 42 315 -123 460 351 -27 136 -82 4 183 195 114 -44 -7 147 167

23

ECONOMIC BULLETIN • july 2015

Employment rate Source: Statistics Korea (employment trends) 64

(%)

63 62 61 60 59 58 57 56 55 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

Original data

2015.1

Seasonally adjusted rate

Employment by industry

Source: Statistics Korea (employment trends)

(%)

100

80

60

70.9 71.1 70.2 69.4 69.2 69.1 69.4 69.6 69.4 69.1 69.7 70.8 71.1 71.2 70.6 69.7 69.4 69.3 69.6 69.7 69.6 69.5 69.8 70.8 71.5 71.4 70.8 70.2 70.0

40 6.9

6.7

6.9

7.1

7.1

7.1

7.0

6.9

7.0

7.1

7.0

7.0

6.8

6.7

6.8

6.9

7.1

7.1

7.1

7.0

7.1

7.1

7.2

7.2

7.0

6.9

7.0

7.1

7.1

20 17.4 17.3 16.9 16.7 16.4 16.4 16.4 16.3 16.4 16.5 16.7 17.1 17.3 17.2 17.0 16.7 16.8 16.8 16.8 16.7 16.8 16.8 16.8 17.4 17.6 17.6 17.3 17.2 17.0 0

4.3

4.6

2013.1 2

5.6

6.3

6.7

6.9

6.7

6.8

6.8

6.9

6.2

4.7

3

4

5

6

7

8

9

10

11

12 2014.1 2

Services

4.4

4.5

5.3

6.1

6.4

6.5

6.2

6.2

6.2

6.2

5.8

4.2

4.1

4.9

5.5

5.9

3

4

5

6

7

8

9

10

11

12 2015.1 2

3

4

5

Construction

Manufacturing

3.9

Agriculture, forestry & fisheries

Employment by status of workers Source: Statistics Korea (employment trends) 100

80

4.2

4.7

5.0

5.0

5.2

5.1

5.2

5.2

5.3

5.1

4.3

4.2

4.3

4.6

4.8

5.0

5.0

5.0

5.0

4.9

4.9

4.7

4.1

4.0

4.1

4.3

4.5

(%) 4.6

22.7 22.8 23.0 22.8 22.6 22.5 22.6 22.7 22.5 22.4 22.2 21.9 22.1 22.0 22.3 22.2 22.1 22.1 22.1 22.4 22.2 22.1 21.9 21.5 21.5 21.5 21.9 21.8 21.8 6.2

60

4.2

6.0

6.0

6.5

6.7

6.7

6.3

6.1

6.3

6.5

6.4

6.4

6.3

6.0

5.7

6.0

6.1

6.1

6.0

5.8

6.1

6.2

6.4

6.2

6.0

6.0

5.7

6.2

6.5

19.9 19.7 19.5 19.5 19.5 19.5 19.6 19.2 19.4 19.4 19.5 19.5 19.2 19.4 19.6 19.7 19.7 19.5 20.1 19.7 19.8 19.7 19.7 19.7 19.5 19.4 19.5 19.4 19.3

40

20

46.9 47.3 47.0 46.3 46.2 46.1 46.4 46.8 46.7 46.5 46.9 47.8 48.3 48.2 47.8 47.3 47.1 47.2 46.8 47.0 47.1 47.2 47.3 48.5 49.0 49.0 48.5 48.1 47.8

0 2013.1 2

3

4

Unpaid family workers

5

6

7

8

9

10

11

Self-employed workers

12 2014.1 2

3

Daily workers

4

5

6

7

8

9

10

Temporary workers

11

12 2015.1 2

3

4

5

Permanent workers

24

The Green Book : Current Economic Trends

The number of unemployed persons in May increased by 71,000 year-on-year to 1,022,000, and the unemployment rate rose 0.2 percentage points to 3.8 percent. The unemployment rate declined among those in their 30s, but rose in all other age groups.

Unemployment rate 6

Source: Statistics Korea (employment trends)

(%)

5

4

3

2 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

Original data

2014.1

2015.1

Seasonally adjusted rate

2011 2012 2013 Annual Annual Annual Q3

Q4 Annual Q1

2014 Q2 Q3

Number of unemployed (thousands)

855

820

807

777

733

Unemployment growth (y-o-y, thousands)

-65

-35

-13

7

- Male

-48

-26

-6

11

- Female

-17

-9

-7

-4

18

80

84 103

Unemployment rate (%)

3.4

3.2

3.1

3.0

2.8

3.5

4.0

Q4

May

Q1

2015 Apr

May

937 1,031 977

884

854

951 1,089 1,053 1,022

11

137

107

121

154

58

23

71

-7

49

37

59

50

25

-1

49

70

63

105

32

24

21

3.3

3.2

3.6

4.1

3.9

3.8

125 165 40

62 3.7

(Seasonally adjusted)

3.4

3.2

3.1

3.1

3.0

3.5

3.5

3.7

3.5

3.5

3.7

3.7

3.7

3.9

-15 to 29

7.6

7.5

8.0

7.9

7.9

9.0

9.8

9.4

8.6

8.3

8.7

10.3

10.2

9.3

- 30 to 39

3.4

3.0

3.0

2.9

2.6

3.1

3.2

3.4

3.0

2.8

3.3

3.1

3.6

3.1

- 40 to 49

2.1

2.0

2.0

1.9

1.7

2.2

2.3

2.4

2.1

2.1

2.6

2.4

2.4

2.7

- 50 to 59 - 60 or more

2.1

2.1

1.9

1.8

1.5

2.2

2.2

2.3

2.1

2.2

2.4

2.6

2.5

2.6

2.6

2.4

1.8

1.2

1.4

2.3

4.4

1.9

1.5

1.6

1.8

4.1

2.3

2.2

Source: Statistics Korea

The economically inactive population in May was up 73,000 from a year earlier to 15,760,000, while the labor force participation rate rose 0.3 percentage points to 63.3 percent.

The number of those economically inactive due to education (down 230,000, y-o-y) and housework (down 49,000, y-o-y) decreased, while those due to rest (up 138,000, y-o-y) and childcare (up 43,000, y-o-y) increased.

25

ECONOMIC BULLETIN • july 2015

Labor force participation rate 65

Source: Statistics Korea (employment trends)

(%)

64 63 62 61 60 59 58 57 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

Original data

Seasonally adjusted rate

2011 2012 2013 Annual Annual Annual Q3 Economically inactive population (millions)

2015.1

Q4 Annual Q1

2014 Q2 Q3

Q4

May

Q1

2015 Apr May

15.95 16.08 16.22 15.98 16.17 15.98 16.40 15.69 15.76 16.07 15.69 16.47 15.97 15.76

Labor force participation rate (%) 61.1 61.3 61.5 62.1 61.7 62.4 61.3 63.1 63.0 62.4 63.0 61.5 62.8 63.3 (Seasonally adjusted) 61.1 61.3 61.5 61.6 61.7 62.4 62.6 62.2 62.5 62.4 62.0 62.8 62.4 62.3 Growth in economically inactive population 112 128 141 78 -91 -246 -433 -226 -222 -101 -162 72 272 73 (y-o-y, thousands) - Childcare - Housework - Education - Old age - Rest

-5 101 -51 -45 182

-2 123 -12 148 -53

1 -3 77 54 -7

9 -14 -39 -29 -57 -41 -80 -112 -131 -230 -127 -99 88 -44 -81 -76 -68 -109 32 21 93 81 113 91 12 21 -92 -197 -90 -65

-31 -58 41 71 43 -67 -133 -91 -2 -49 -72 -32 -141 -197 -230 89 115 68 107 82 -15 -94 154 214 138

Source: Statistics Korea

9. Financial markets 9.1 Stock market The KOSPI fell 1.9 percent in June, from 2,115 points to 2,074 points. The KOSPI declined early in the month due to concerns over the MERS outbreak and uncertainties over debt negotiations in Greece. However, investor sentiment picked up later in the month following interest rate cuts and the government’s supplementary budget proposal.

The KOSDAQ rose 4.3 percent from 711 points to 742 points. Biotech and healthcare stocks rose as a result of the MERS outbreak, while demand for small-cap stocks increased following poor performance by large-cap stocks.

26

The Green Book : Current Economic Trends

Stock prices 2,200

(monthly average)

2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

KOSPI

2015.1

KOSDAQ

(Closing rate)

May 2015

KOSPI Jun 2015

Change1

Stock price index (points)

2,114.8

2,074.2

Market capitalization (trillion won)

1,318.6

Average daily trade value (trillion won) Foreign stock ownership (%, %p)

May 2015

KOSDAQ Jun 2015

Change1

-40.6 (-1.9%)

711.4

742.3

30.9 (4.3%)

1,293.1

-25.5 (-1.9%)

192.5

203.0

10.5 (5.5%)

5.9

6.0

0.1 (1.7%)

3.9

4.2

0.3 (7.7%)

33.5

32.8

-0.7 (-2.1%)

10.3

10.2

-0.1 (-1.0%)

1. Change from the end of the previous month Source: Korea Exchange

9.2 Exchange rate The dollar-won exchange rate in June rose 7.3 won to 1,115.5 won from 1,108.2 won at the end of May, despite export companies selling dollars, due to increased demand for safe-haven assets amid Greek debt negotiation uncertainties as well as expectations for expansionary monetary policies.

The 100 yen-won exchange rate rose from 894.7 won in May to 912.0 won in June, as the yen appreciated due to BOJ Governor Haruhiko Kuroda’s comments on the weak yen, and also due to increased demand for safe-haven assets.

(Closing rate)

2009 Dec

2010 Dec

2011 Dec

2012 Dec

2013 Dec

2014 Dec

May

2015 Jun

Change1

Dollar-Won

1,164.5

1,134.8

1,151.8

1,070.6

1,055.4

1,099.3

1,108.2

1,115.5

-0.7

100 Yen-Won

1,264.5

1,393.6

1,481.2

1,238.3

1,002.3

913.0

894.7

912.0

-1.9

1. Appreciation from the end of the previous year (%); the exchange rate is based on the closing price at 3:00 p.m., local time.

27

ECONOMIC BULLETIN • july 2015

Foreign exchange rates 1,800

(month-end, \)

1,600

1,400

1,200

1,000

800

600 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

Dollar-Won

2014.1

2015.1

100 Yen-Won

Daily exchange rate trend 1,800

1,600

1,400

1,200

1,000

800

600 2009.1

2010.1

Dollar-Won

2011.1

2012.1

2013.1

2014.1

2015.1

100 Yen-Won

9.3 Bond market 3-year Treasury bond yields rose from 1.75 percent in May to 1.79 percent in June. Treasury bond yields rose due to a rise in US Treasury bond yields, weakened expectations for additional rate cuts following the BOK’s decision to lower the benchmark interest rate, and uncertainties over the volume of Treasury bond issuance following the government’s supplementary budget proposal.

28

The Green Book : Current Economic Trends

Interest rates 10

Source: The Bank of Korea

(monthly average, yearly, %)

9 8 7 6 5 4 3 2 1 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

Overnight call rate (daily)

2010.1

2011.1

2012.1

2013.1

2014.1

3-yr Treasury bond yield

2015.1

3-yr corporate bond yield

(Closing rate, %)

2009 Dec

2010 Dec

2011 Dec

2012 Dec

2013 Dec

2014 Dec

2015 Apr

May

Jun

Call rate (1 day)

2.01

2.51

3.29

2.77

2.52

2.03

1.74

1.74

1.50

-24

CD (91 days)

2.88

2.80

3.55

2.89

2.66

2.13

1.80

1.80

1.65

-15

Treasury bonds (3 yrs)

4.44

3.38

3.34

2.82

2.86

2.10

1.84

1.75

1.79

4

Corporate bonds (3 yrs)

5.56

4.27

4.21

3.29

3.29

2.43

2.08

2.01

2.01

-

Treasury bonds (5 yrs)

4.98

4.08

3.46

2.97

3.23

2.28

2.04

1.92

2.07

15

Change1

1. Basis point, changes from the previous month

9.4 Money supply & money market M2 (monthly average) in April rose 9.0 percent from a year earlier. Private sector credit surged due to an increase in loans and securities investment, and money supply in the overseas and government sectors also rose due to current account surpluses and an increase in government spending.

(Percentage change from same period in previous year, average)

2009 Annual

2010 Annual

2011 Annual

2012 Annual

2013 Annual

M1²

16.3

11.8

6.6

3.8

9.5

M2 Lf Âł

10.3

8.7

4.2

5.2

7.9

8.2

5.3

7.8

1. Balance at end April 2015, trillion won 2. M1 excluding corporate MMFs and individual MMFs while including CMAs 3. Liquidity aggregates of financial institutions (mostly identical with M3)

2014 Annual

2015 Feb

Mar

Apr

Apr1

10.9

14.3

15.5

17.7

610.8

4.8

6.6

8.0

8.3

9.0

2,148.1

6.9

7.0

8.6

9.3

10.0

2,936.7

29

ECONOMIC BULLETIN • july 2015

Total money supply Source: The Bank of Korea 40 (y-o-y, monthly average balance, %) 30

20

10

0

-10

-20 2004.1

2005.1

2006.1

2007.1

2008.1

Reserve money

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

M1

2015.1

Lf

Bank deposits surged in May, led by instant access deposits (3.2 trillion won → 13.2 trillion won), due to inflows of corporate settlement funds and municipal education department funds, and also as the end of the month fell on a weekend, delaying loan repayments.

Asset management company (AMC) deposits declined, led by money market funds (MMF) (11.1 trillion won → -3.3 trillion won), due to relatively lower interest rates compared to other short-term investments, and banksʼ withdrawal of funds, subsequently.

Deposits in financial institutions 60 50

Source: The Bank of Korea

(y-o-y, end of month balance, trillion won)

40 30 20 10 0 -10 -20 -30 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

(Change from previous period, end-period, trillion won)

Bank deposits AMC deposits 1. Balance at end May 2015

2009 2010 2011 2012 2013 2014 Annual Annual Annual Annual Annual Annual Dec 54.8 36.9 58.9 37.0 41.0 115.4 52.0 -27.6 -16.7 -16.6 18.8 17.7 47.0 -8.7

2015 Mar 5.7 2.0

Apr -0.1 14.2

May 15.6 -2.2

May1 1,303.8 421.7

30

The Green Book : Current Economic Trends

10. Balance of payments Korea’s current account (preliminary) in May posted a surplus of US $8.65 billion, staying in the black for 39 consecutive months, the longest streak in history.

The goods account surplus declined from US $12.56 billion in April to US $9.19 billion in May, due to fewer days worked (1 day) and regular maintenance in oil refineries and petrochemical production facilities.

Goods exports (US $ billion) 50.38 (Apr 2015) → 43.87 (May 2015) Goods imports (US $ billion) 37.82 (Apr 2015) → 34.68 (May 2015) Export growth by item (y-o-y, %) -10.9 (total), -39.9 (petroleum products), -21.2 (steel), -8.5 (automobiles), 4.3 (semiconductors), 24.0 (mobile phones) Import growth by category (y-o-y, %) -15.4 (total), -24.7 (commodities), -3.4 (capital goods), 2.1 (consumer goods)

Current account balance 14

Source: The Bank of Korea (balance of payments trends)

(US $ billion)

12 10 8 6 4 2 0 -2 -4 -6 2004.1

2005.1

2006.1

2007.1

2008.1

Goods account

2009.1

2010.1

2011.1

Services account

2012.1

2013.1

2014.1

2015.1

Current account

The services account deficit fell from US $1.13 billion to US $0.40 billion, as the transportation, travel and intellectual property rights accounts improved.

Services account (US $ billion, April → May) -0.43 → -0.45 (manufacturing), 0.16 → 0.37 (transportation), -0.59 → -0.41 (travel), 0.74 → 0.74 (construction), -0.19 → 0.01 (intellectual property rights), -0.79 → -0.71 (other businesses)

31

ECONOMIC BULLETIN • july 2015

Travel balance 4

Source: The Bank of Korea (balance of payments trends)

(US $ billion)

3

2

1

-1

-2 -3 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

Travel balance

2010.1

2011.1

2012.1

2013.1

2014.1

Travel revenue

2015.1

Travel payment

The primary income account turned positive from a deficit of US $2.84 billion to a surplus of US $0.29 billion as dividend payments for the 2015 fiscal year ended. The secondary income account deficit fell from US $0.46 billion to US $0.43 billion.

(US $ billion)

2013 Annual Annual

2014 Q1

Q2

Q3

Q4

May

Q1

2015 Apr

May1 8.65

Current account

81.15

89.22

15.19

24.24

22.57

27.23

9.12

23.45

8.14

- Goods balance

82.78

92.69

17.75

26.43

21.68

26.84

9.13

25.26

12.56

9.19

- Services balance

-6.50

-8.16

-3.50

-1.84

-0.90

-1.92

-0.30

-5.41

-1.13

-0.40

- Primary income balance - Secondary income balance

9.06

10.20

1.91

1.33

3.14

3.82

0.73

4.83

-2.84

0.29

-4.19

-5.50

-0.96

-1.68

-1.35

-1.51

-0.44

-1.22

-0.46

-0.43

1. Preliminary Source: The Bank of Korea

The capital and financial account (preliminary) in May posted a net outflow of US $8.81 billion.

Capital & financial account balance (US $ billion) -6.80 (Oct 2014) → -9.92 (Nov) → -9.80 (Dec) → -8.25 (Jan 2015) → -5.54 (Feb) → -11.03 (Mar) → -10.07 (Apr) → -8.81 (May)

FDI net outflows decreased from US $1.97 billion to US $1.20 billion.

Net outflows of portfolio investment increased slightly from US $0.14 billion to US $0.36 billion as foreign investment in Korean shares declined.

Net inflows of financial derivatives investment rose from US $0.30 billion to US $0.40 billion, while net outflows of other investment inched down from US $4.85 billion to US $4.76 billion.

The current account is expected to continue posting a surplus in June, considering the trade surplus in June (US $10.24 billion).

32

The Green Book : Current Economic Trends

Capital & financial account balance

Source: The Bank of Korea (balance of payments trends)

15 (US $ billion) 10

5

0

-5

-10

-15 2004.1

2005.1

2006.1

2007.1

Direct investment

2008.1

2009.1

2010.1

Portfolio investment

2011.1

2012.1

2013.1

Financial derivatives

2014.1

2015.1

Capital & financial account

11. Prices 11.1 Consumer prices Consumer prices rose 0.7 percent year-on-year in June.

Consumer price inflation 7

Source: Statistics Korea (consumer price trends)

(%)

6 5 4 3 2 1 0 -1 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

Consumer price inflation (m-o-m)

2014.1

2015.1

Consumer price inflation (y-o-y)

Consumer price inflation

(%)

2014 Month-on-Month Year-on-Year Source: Statistics Korea

Nov -0.2 1.0

2015 Dec 0.0 0.8

Jan 0.5 0.8

Feb 0.0 0.5

Mar 0.0 0.4

Apr 0.1 0.4

May 0.3 0.5

Jun 0.0 0.7

33

ECONOMIC BULLETIN • july 2015

Contribution to consumer price inflation 7

Source: Statistics Korea (consumer price trends)

(%p)

5

3

1

‐1 2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Agricultural, livestock & fishery products

Manufactured products

Housing rents

Public services

Personal services

Public utilities

Declines in oil product prices (down 17.0%) and public gas fees (down 20.9%) pushed down consumer price inflation in May by 1.4 percentage points. Public gas fees were cut three times this year, 5.9 percent in January, 10.1 percent in March and 10.3 percent in May. Due to rising exchange rates, oil product prices fell at a slower pace in June compared to May (down 19.3%).

Agricultural, livestock & fishery product prices rose due to droughts and a low base effect from a year ago.

Consumer price inflation in major sectors Total Year-on-Year (%) Contribution (%p)

0.7 -

Agricultural, livestock & fishery products 4.1 0.30

Manufactured Public Housing Public Personal products Oil products utilities rents services services -0.1 -17.0 -9.0 2.5 0.5 1.9 -0.04 -0.88 -0.47 0.24 0.08 0.59

Core inflation stayed in the 2 percent range. Consumer prices excluding oil and agricultural products rose 2.0 percent year-on-year, and consumer prices excluding food and energy rose 2.2 percent.

Prices 16

Source: Statistics Korea (consumer price trends)

(y‐o‐y, %)

13 10 7 4 1 -2 -5 2004.1

2005.1

2006.1

Consumer price inflation

2007.1

2008.1

2009.1

2010.1

Core inflation

2011.1

2012.1

2013.1

2014.1

2015.1

Producer price inflation

34

The Green Book : Current Economic Trends

(y-o-y, %)

Consumer prices excluding oil and agricultural products Consumer prices excluding food and energy

2014 Dec 1.6 1.4

2015 Jan 2.4 2.3

Feb 2.3 2.3

Mar 2.1 2.3

Apr 2.0 2.3

May 2.1 2.2

Jun 2.0 2.2

Source: Statistics Korea

The expected annual inflation remained flat at 2.5 percent.

Expected inflation (%, Bank of Korea) 2.6 (Dec 2014) → 2.6 (Jan 2015) → 2.6 (Feb) → 2.5 (Mar) → 2.5 (Apr) → 2.5 (May) → 2.5 (Jun)

11.2 International oil and commodity prices International oil prices fell in June as OPEC decided to maintain its output quota and Greek debt negotiations hit a roadblock.

Dubai crude prices fell, despite declining US crude oil inventories, due to Greek bailout concerns and OPEC’s decision to maintain its output quota. At a June 5 meeting, OPEC agreed to keep its output quota on hold at 30 million barrels per day.

Dubai crude ($/barrel) 61.1 (1st week Jun) → 61.7 (2nd week) → 60.9 (3rd week) → 60.3 (4th week)

International oil prices 160

Source: Korea National Oil Corporation

($/B)

140 120 100 80 60 40 20 0 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

Dubai crude

2015.1

WTI

(US $/barrel, period average)

Dubai crude Brent crude WTI crude Source: Korea PDS

2013 Annual Annual 105.2 96.6 108.7 99.1 98.0 93.1

Q1 104.4 108.1 98.7

2014 Q2 106.1 109.7 103.0

Q3 101.6 102.7 97.2

Q4 74.6 76.7 73.4

Jan 45.8 49.7 47.3

Feb 55.7 58.8 50.7

2015 Mar Apr 54.7 57.7 56.9 61.1 47.9 54.6

May 63.0 65.6 59.4

Jun 60.8 63.8 59.8

35

ECONOMIC BULLETIN • july 2015

Domestic gasoline prices were up in June as rising international gasoline prices and the weakening won were reflected with a time lag of around two weeks. International gasoline prices rose as refineries in Japan and India temporarily halted production, while Malaysia and Indonesia sought to build up inventories before Ramadan.

Domestic gasoline prices (won/liter) 1,542.2 (May 2015) → 1,572.4 (1st week Jun) → 1,576.7 (2nd week) → 1,581.0 (3rd week) → 1,584.3 (4th week) International gasoline prices ($/barrel) 79.4 (4th week Apr-2nd week May) → 82.7 (3rd week May) → 81.4 (4th week) → 81.2 (1st week Jun) → 83.3 (2nd week) Dollar-won exchange rate (won) 1,083 (4th week Apr-2nd week May) → 1,091 (3rd week May) → 1,101 (4th week) → 1,110 (1st week Jun) → 1,116 (2nd week)

(Won/liter, period average)

2013 Annual Annual

Q1

2014 Q2

2015 Q3

Q4

Jan

Feb

Mar

Apr

May

Jun

Gasoline prices

1,924.5 1,827.6 1,882.6 1,868.6 1,837.8 1,721.1 1,504.8 1,439.1 1,507.7 1,507.4 1,542.2 1,580.0

Diesel prices

1,729.6 1,637.0 1,699.9 1,680.0 1,641.4 1,526.7 1,330.5 1,277.1 1,326.8 1,320.2 1,343.5 1,368.8

Source: Korea National Oil Corporation

Dubai crude prices and import prices Source: Korea National Oil Corporation 160

(thousand won/B)

($/B)

160

140

140

120

120

100

100

80

80

60

60

40

40

20

20

2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

Dubai crude (import prices, won, left)

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

Dubai international prices (dollar, right)

International grain prices rose in June, led by wheat and corn, due to adverse weather conditions caused by El Niño, and also as the International Grains Council cut its forecast for wheat output and inventories.

International grain price increases in June (m-o-m, %) wheat (5.8), corn (1.3), soybeans (0.9), raw sugar (-7.5)

36

The Green Book : Current Economic Trends

Nonferrous metal prices fell due to declining demand and Greek bailout issues. The IMF cut its 2015 forecast for the US from 3.1 percent to 2.5 percent, while industrial production in China rose 6.1 percent in May, falling short of expectations.

Nonferrous metal price increases in June (m-o-m, %) zinc (-8.8), copper (-7.4), aluminum (-6.7), nickel (-5.4)

International commodity prices

Sources: Bloomberg (CRB), The Bank of Korea (Reuters Index)

* CRB demonstrates a futures price index of 21 commodities listed on the US Commodity Transaction Market, including beans and other crops, crude oil and jewelry.

4000

470 430

3000

390 350

2000

310 270

1000

230 190 150

0

2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

CRB (left)

2015.1

Reuters index (right)

(Period average)

2013 Annual Annual

Q1

2014 Q2

Q3

Q4

Jan

Feb

Mar

2015 Apr

May

Jun

2,600

2,609

2,491

2,397

2,377

2,351

2,374

2,389

2,374

2,415

1

Reuters Index (sep 18,1931=100)

2,774

2,523

1. A weighted average index of 17 major commodities Source: KOREA PDS

12. Real estate market 12.1 Housing market Apartment prices rose 0.4 percent month-on-month nationwide in June.

Apartment price growth accelerated in the Seoul metropolitan area (up 0.5%), which includes Seoul (up 0.5%) and Gyeonggi Province (up 0.5%).

37

ECONOMIC BULLETIN • july 2015

Apartment price growth in areas excluding the Seoul metropolitan area also accelerated (up 0.3%). Apartment prices in the five metropolitan cities and the eight provinces were up 0.5 percent and 0.1 percent, respectively.

Apartment price increase in five metropolitan cities (m-o-m, %) Busan (0.4), Daegu (0.9), Gwangju (0.7), Daejeon (0.0), Ulsan (0.4)

Apartment sales prices by region

Source: Korea Appraisal Board

3

2

1

0

-1 2009.1

7

2010.1

7

2011.1

7

Nationwide

2012.1

7

2013.1

7

Seoul metropolitan area

15.1

2015.1

(Percentage change from previous period)

2010 2011 2012 2013 2014 Annual Annual Annual Annual Annual Jun Annual Jan 1.9 6.9 0.0 0.3 1.7 0.0 1.8 0.1 -1.7 0.5 -3.0 -1.1 1.5 0.0 2.3 0.1 -1.2 0.3 -2.9 -1.4 1.1 -0.1 2.1 0.1 -1.0 0.3 -3.5 -1.1 1.2 -0.1 2.6 0.1 -1.4 0.3 -2.3 -1.7 1.1 0.0 1.6 0.0 6.4

7

Areas excluding Seoul metropolitan area

Nationwide apartment prices Nationwide Seoul metropolitan area Seoul Gangnam¹ Gangbuk² Areas excluding the Seoul metropolitan area

2014.1

3.1

1.7

1.9

0.1

1.4

0.2

Feb 0.2 0.2 0.2 0.2 0.2

2015 Mar 0.3 0.4 0.4 0.4 0.3

Apr 0.4 0.6 0.5 0.6 0.4

May 0.3 0.4 0.4 0.6 0.3

Jun 0.4 0.5 0.5 0.6 0.4

0.2

0.2

0.3

0.2

0.3

1. Upscale area of Southern Seoul 2. Northern Seoul Source: Korea Appraisal Board

Apartment rental prices rose 0.5 percent month-on-month nationwide in June.

Rental prices rose 0.7 percent in the Seoul metropolitan area and 0.3 percent in regions excluding the Seoul metropolitan area.

Apartment rental price increase in major districts in Seoul (m-o-m, %) Gangnam (0.8), Seocho (1.0), Songpa (1.0), Gangdong (1.1), Guro (1.1), Nowon (1.1)

38

The Green Book : Current Economic Trends

Nationwide apartment rental prices 2010 Annual 7.1 6.3 6.4 7.6 5.1

Nationwide Seoul metropolitan area Seoul Gangnamš Gangbuk² Areas excluding the Seoul metropolitan area

9.2

(Percentage change from previous period)

2011 2012 2013 2014 Annual Annual Annual Annual Jun Annual Jan 12.3 3.5 4.7 3.4 0.1 2.6 0.3 11.0 2.1 6.2 4.7 0.1 3.9 0.4 10.8 2.1 6.6 3.6 0.0 3.5 0.3 11.1 2.4 6.7 3.3 0.0 4.3 0.4 10.6 1.8 6.4 3.8 0.1 2.7 0.2 14.5

4.6

3.3

2.2

0.1

1.5

0.2

Feb 0.3 0.5 0.5 0.6 0.3 0.2

2015 Mar Apr May Jun 0.5 0.6 0.4 0.5 0.7 0.9 0.7 0.7 0.6 0.8 0.6 0.7 0.7 1.0 0.7 0.8 0.5 0.6 0.5 0.5 0.3

0.3

0.2

0.3

1. Upscale area of Southern Seoul 2. Northern Seoul Source: Korea Appraisal Board

Apartment rental prices by region Source: Korea Appraisal Board 3

(m-o-m, %)

2

1

0

-1

-2 2009.1

7

2010.1

7

2001.1

7

Nationwide

2012.1

2013.1

7

Seoul metropolitan area

Monthly apartment transaction volume 160

7

2014.1

7

2015.1

Areas excluding Seoul metropolitan area

Source: Ministry of Land, Infrastructure and Transport

(thousands)

140 120 100 80 60 40 20 0 2009.1

Nationwide

7

2010.1

7

2011.1

7

2012.1

Seoul metropolitan area

7

2013.1

7

2014.1

7

2015.1

Areas excluding Seoul metropolitan area

39

ECONOMIC BULLETIN • july 2015

Apartment sales transactions declined 8.8 percent from 120,488 transactions in April to 109,872 transactions in May. Compared to the same month of the previous year, apartment sales transactions were up 40.5 percent in May.

Apartment sales transactions

(Thousands)

2010 2011 2012 2013 2014 2015 Annual1 Annual1 Annual1 Annual1 Annual1 May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Nationwide

67

82

61

71

84

78

74

77

76

87

109

91

91

79

79

112 120 110

1. Monthly average Source: Ministry of Land, Infrastructure and Transport

12.2 Land market Land prices rose 0.18 percent month-on-month nationwide in May. Land price growth decelerated in the Seoul metropolitan area (up 0.17%), which includes Gyeonggi Province (up 0.11%) and Incheon (up 0.14%).

Land price increase in Seoul metropolitan area (m-o-m, %) 0.20 (Oct 2014) → 0.14 (Nov) → 0.14 (Dec) → 0.14 (Jan 2015) → 0.15 (Feb) → 0.17 (Mar) → 0.19 (Apr) → 0.17 (May)

Land price growth decelerated in areas excluding the Seoul metropolitan area (up 0.20%), which include Jeju Province (up 0.20%), South Gyeongsang Province (up 0.17%) and North Chungcheong Province (up 0.14%).

Land price increase in areas excluding Seoul metropolitan area (m-o-m, %) 0.20 (Oct 2014) → 0.18 (Nov) → 0.20 (Dec) → 0.15 (Jan 2015) → 0.15 (Feb) → 0.22 (Mar) → 0.21 (Apr) → 0.20 (May)

Land and consumer prices since 1970s 60

Source: Korea Appraisal Board

(y‐o‐y, %)

50 40 30 20 10 0 -10 -20 1974

1978

Land price inflation

1982

1986

1990

1994

1998

2002

2006

2010

2014

Consumer price inflation

40

The Green Book : Current Economic Trends

Land prices

(Percentage change from previous period)

2009 2010 2011 2012 2013

2014

Annual Annual Annual Annual Annual Annual Q1

Q2

2015 Q3

Q4 Annual Q1

Mar

Apr May

Nationwide

0.96 1.05

1.17

0.96

1.14

1.96 0.45 0.48 0.49 0.53

0.85 0.48 0.19 0.20 0.18

Seoul

1.40 0.53

0.97

0.38

1.21

2.66 0.69 0.59 0.69 0.67

1.03 0.57 0.21 0.23 0.23

Gyeonggi

1.22 1.49

1.47

1.04

0.91

1.24 0.26 0.37 0.27 0.33

0.61 0.35 0.13 0.15 0.11

Incheon

1.99 1.43

0.66

0.46

0.87

1.35 0.37 0.25 0.32 0.40

0.71 0.37 0.13 0.20 0.14

Source: Korea Appraisal Board

There were 262,000 land transactions in May, down 10.4 percent from the previous month but up 26.8 percent from 207,000 a year earlier.

Land transactions declined in Seoul (down 4.6%, m-o-m), Daegu (down 18.2%, m-o-m), Gwangju (down 21.9%, m-o-m) and North Gyeongsang Province (down 22.1%, m-o-m).

Vacant land transactions, which accounted for 35.0 percent of total land transactions, fell 11.1 percent monthon-month to 92,000 but were up 6.5 percent from 86,000 a year earlier.

Land transactions 2010

2011

(Land lots, thousands)

2012

2013

2014

2015

Annual1 Annual1 Annual1 Annual1 Annual1 May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Nationwide

187

208

170

187

220

207 199 219 204 214 258 228 257 219 199 278 293 262

Seoul

16

18

13

17

22

18

18

21

21

23

29

25

23

20

21

33

36

34

Gyeonggi

41

43

33

37

46

42

39

45

42

46

57

50

53

45

43

62

66

60

Incheon

8

10

8

8

10

9

9

8

9

10

13

11

9

8

8

12

13

12

1. Monthly average Source: Korea Land & Housing Corporation

Land transaction volume

Source: Korea Appraisal Board

500,000 (thousand m²) 400,000

300,000

200,000

100,000

0 2004.1

2005.1

2006.1

Seoul metropolitan area

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

Areas excluding Seoul metropolitan area

41

ECONOMIC BULLETIN • july 2015

13. Composite indices of business cycle indicators Industrial output in May declined 0.6 percent month-on-month but rose 0.2 percent year-on-year. Output fell in mining & manufacturing (down 1.3%, m-o-m), services (down 0.4%, m-o-m) and public administration (down 0.1%, m-o-m), but rose in construction (up 2.0%, m-o-m).

Index of all industry production 20

Source: Statistics Korea (industrial activity trends)

(%)

15 10 5 0 -5 -10 -15 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

Index of all industry production (m-o-m)

Index of all industry production (m-o-m, %) (y-o-y, %) Coincident composite index (2010=100) (m-o-m, %) Cyclical indicator of coincident composite index (m-o-m, p) Leading composite index (2010=100) (m-o-m, %) Cyclical indicator of leading composite index (m-o-m, p)

2014.1

2015.1

Index of all industry production(y-o-y)

Oct 0.4 0.2

2014 Nov -0.1 -0.5

Dec 1.3 2.1

Jan -1.9 0.6

Feb 2.2 0.6

2015 Mar1 -0.5 2.0

Apr1 -0.4 0.7

May1 -0.6 0.2

121.9 0.1

122.2 0.2

123.1 0.7

123.6 0.4

124.4 0.6

124.7 0.2

125.1 0.3

125.0 -0.1

99.9 -0.3

99.8 -0.1

100.1 0.3

100.1 0.0

100.5 0.4

100.3 -0.2

100.3 0.0

99.8 -0.5

124.4 0.6

124.9 0.5

125.9 0.7

127.8 1.5

129.0 0.9

130.5 1.2

131.1 0.5

132.1 0.8

101.2 0.2

101.1 -0.1

101.5 0.4

102.5 1.0

103.1 0.6

103.8 0.7

103.8 0.0

104.1 0.3

1. Preliminary

The cyclical indicator of the coincident composite index fell 0.5 points month-on-month. Retail sales rose, but service output remained unchanged and five other components of the coincident composite index declined.

Components of the coincident composite index in May (m-o-m) retail sales (0.4%), service output (0.0%), mining & manufacturing production (-0.9%), value of construction completed (-2.6%), domestic shipments (-0.3%), imports (-0.7%), nonfarm payroll employment (-0.1%)

42

The Green Book : Current Economic Trends

Cyclical indicator of coincident composite index 110

Source: Statistics Korea (industrial activity trends)

(points)

100

90 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

The cyclical indicator of the leading composite index rose 0.3 points. The inventory circulation indicator, domestic shipments of machinery and international commodity prices declined, while six other components of the leading composite index rose.

Components of the leading composite index in May (m-o-m) consumer expectations index (0.7p), value of construction orders received (20.0%), ratio of export to import prices (0.3%), ratio of job openings to job seekers (0.5%p), KOSPI (2.5%), spreads between long & short term interest rates (0.04%p), inventory circulation indicator (-0.8%p), domestic shipments of machinery (-1.6%), international commodity prices (-0.3%)

Cyclical indicator of leading composite index 110

Source: Statistics Korea (industrial activity trends)

(points)

100

90 2004.1

2005.1

2006.1

2007.1

2008.1

2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

43

ECONOMIC BULLETIN • july 2015

Investment Promotion Measures: Tourism, Ventures and Construction Supplementary Budget of 12 Trillion Won Proposed

Policy Issues

44

Policy Issues

Investment Promotion Measures: Tourism, Ventures and Construction The government unveiled the Investment Promotion Measures for Tourism, Ventures and Construction at the 8th Trade and Investment Promotion Meeting, along with its plan to support the restart of stalled projects. Tourism, ventures and construction have been selected, taking into account the effects the industries will have on other areas.

Support for stalled projects - R emove permit-related obstacles to solar panel projects in the Saemangeum Reclamation Area, which is expected to attract 0.3 trillion won of investment - Provide environmental analyses of offshore solar power plants to support the installation of 13 offshore

President Park Geun-hye (center) speaks at the 8th Trade and Investment Promotion Meeting at Cheongwadae on July 9.

45

ECONOMIC BULLETIN • july 2015

solar power plants, which has been stalled due to the lack of such data - Facilitate cooperation between the two parties with regard to the use of sandy soil, one of the by-products of factory construction: One can use the soil for offshore reclamation to build a factory, while the other can dispose the by-product, which will get around 0.5 trillion won of investment to be made - S upport the driverless car project in the Seosan industrial zone by providing a site for research centers and roads for testing the car to be located - Allow a company to lease its pier to its subsidiary if the company meets the requirement regarding shareholding in subsidiaries in order to support the subsidiary’s tank terminal business

Tourism - H elp the tourism industry overcome the MERS aftermath by increasing financial support (300 billion won), easing visa regulations, and cooperating with foreign health authorities to promote medical tourism - Help develop customized tours: tours involving popular music performance, traditional food and shopping, in particular cosmetics, for Asian female tourists aged between 20 and 50, tours involving medical care, casino visits and cruise for male tourists in their 30s and 40s, tours involving sports and outdoor activities for female tourists aged between 20 and 40 - Increase competitiveness: improving communications, transportation and accommodation services for tourists, developing creative tour programs, and improving the quality of group tour packages

Ventures - Develop the Creative Economy Innovation Centers into a base for startup ventures, where support specific to different stages of business development, from idea

Chinese journalists and tourism industry representatives, invited by Korean Air and Hotel Shilla as an effort to attract tourists following the MERS outbreak, visit a duty free shop in downtown Seoul on July 14.

incubation to overseas marketing, is provided - Encourage venture establishment by talented young adults: giving them financial and military service incentives, granting incentives to talented foreigners (those holding special professional visas, E-3) when transferring to a technology-based startup visa, easing regulations regarding technology ventures including the joint surety requirement and minimum shareholding requirement for subsidiary ownership, building a human capital information system to facilitate the use of local talents, supporting the establishment of startup accelerators including giving them tax incentives, providing customized startup support according to the stages of business development - Promote M&As of venture SMEs by large corporations: increasing M&A tax incentives, easing shareholding regulations, designating investment banks that specialize in M&As of SMEs, enacting a Corporate Revitalization Act to facilitate venture M&As - Promote venture investment: allowing the secondary sales of stakes in venture capital funds as well as facilitating IPOs by encouraging competition between the KOSPI and KOSDAQ markets, easing regulations regarding the establishment of venture

46

Policy Issues

capital funds, such as allowing the establishment of M&A and secondary market funds without investment by a fund of funds and authorizing New Technology Venture Capital Companies1 and limited liability companies to manage venture capital funds, requiring a fund of funds to invest 30 percent of its capital in a new Young Adult Startup Fund 2 , expanding the income tax deduction for angel investments from investments in venture companies to startup companies which are 3 years old or less and meet R&D investment requirements3

tax reductions, easing floor ratio requirements and settling disagreement between interested parties - Promote private sector investment in public building reconstruction, which will be directed towards constructing a building used both commercially and for public service - Support building renewal to ensure safety: carrying out safety inspections of old buildings and encouraging renewal based on the results, providing more than 500 billion won in support for old building renewals as well as offering long-term loans with low interest rates for renewals in the Urban Renewal Areas, revising building regulations to give multiple-use approval4

Building reconstruction - Ease floor ratio requirements for joint reconstruction on properties owned by more than 2 individuals and reconstruction in government-designated special urban areas - Support the restart of stalled reconstruction by giving

1) Financial institutions specializing in new technology investment 2) A total of 300 billion won worth of funds to be launched in 2015-2017 3) The amount will be set 4) The use of a dormitory building for tourist accommodations during breaks

Supplementary Budget of 12 Trillion Won Proposed The government proposed a supplementary budget of around 12 trillion won, 5.6 trillion won to deal with revenue shortages and 6.2 trillion won to help overcome the MERS outbreak, improve water resources management, support the working class and stimulate local economies. The amount will reach around 22 trillion won when other public sector expenditures are

taken into account including 3.1 trillion won from the government funds.

The supplementary budget will be financed mostly by issuing government bonds, and the government will utilize 0.7 trillion won in the Bank of Korea surplus and 1.5 trillion won available from funds.

47

ECONOMIC BULLETIN • july 2015

Supplementary budget and other fiscal stimulus

(trillion won)

Financing revenue shortage

5.6

Financing 2015 revenue shortage

Supplementing budget expenditures

6.2

Support for overcoming the MERS outbreak and drought, and working class support

3.1

Small business support and working class housing support

Investment made by public institutions and through PPP

2.3

Investment made by public enterprises and private investment in public projects made through PPP

Loans, guarantees and insurance offered through public financial institutions

4.5

Korea Credit Guarantee Fund, Korea Technology Finance Corporation, Korea Trade Insurance Corporation, Export-Import Bank of Korea

Government expenditures (around 15 trillion won)

Supplementary budget

Expenditures financed from funds

Total stimulus

Expenditure plan Of the 6.2 trillion won proposed to supplement budget expenditures, 2.5 trillion won will be used to help overcome the aftermath of the MERS outbreak. The budget will support disease prevention in hospitals, finance emergency aid for hospitals directly affected by the disease outbreak and help businesses suffering due to the disease outbreak, such as the tourism industry.

The government will spend 0.8 trillion won on water resources management, such as construction and maintenance of irrigation systems, and on stable supply of agricultural products following the drought.

A total of 1.2 trillion won will be spent to increase jobs for young adults and the elderly, while 1.7 trillion won will be spent to support local economies through early

Around 22

completion of SOC construction, improve sewage systems and upgrade facilities and equipment to property respond to disasters.

Fiscal situation with the supplementary budget Total expenditures will increase by 9.3 trillion won1 to 384.7 trillion won, and total revenues will decrease by 4.9 trillion2 won to 377.5 trillion won.

1) Supplementary budget expenditures (6.2 trillion won) + resources available in funds (3.1 trillion won) 2) Revenue losses (5.6 trillion won) + nontax revenues from the Bank of Korea surplus (0.7 trillion won)

48

Policy Issues

Fiscal deficits will increase by 0.9 percentage points from 2.1 percent of GDP to 3.0 percent of GDP.

National debt will increase by 1.8 percentage points from 35.7 percent of GDP to 37.5 percent of GDP.

Fiscal situation with supplementary budget

(trillion won, %)

2015

2014

Original budget (A)

Supplementary budget (B)

Change (B-A)

Total revenues (change, %)

369.3 (-0.9)

382.4 (3.5)

377.5 (2.2)

-4.9 (-1.3)

Total expenditures (change, %)

355.8 (4.0)

375.4 (5.5)

384.7 (8.1)

9.3 (2.6)

Consolidated fiscal balance without funds (% to GDP)

-25.5 (-1.7)

-33.4 (-2.1)

-46.8 (-3.0)

-13.4 (-0.9)

National debt (% to GDP)

530.5 (35.7)

569.9 (35.7)

579.5 (37.5)

9.6 (1.8)

The government will continue to work to improve fiscal soundness in the mid- to long-run, and minimize bond issuance by utilizing resources set aside for early buybacks.

In order to minimize the effect on the market, the issuance will be made evenly distributed throughout the second half, and the 3-year and 5-year bonds will account

for most of the issuance while the total issuance amounts specific to different maturities will be maintained.

The government will also work to increase fiscal soundness by streamlining national projects, restructuring inefficient fiscal spending systems and reviewing tax breaks.

2015 Treasury bond issuance

(trillion won)

Original plan

After supplementary budget

Change

Total issuance

102.7

112.3 (+9.6)

110.3 (+7.6)

Net increase

43.0

52.6 (+9.6)

52.6 (+9.6)

Budget for early buybacks

8.0

8.0 (0.0)

6.0 (-2.0)

* The 2015 supplementary budget proposal was approved at the National Assembly on July 24 with around 0.26 trillion won cuts: a 0.2 trillion won cut in revenue financing and a 0.06 trillion won cut in budget expenditures.

49

ECONOMIC BULLETIN • july 2015

Foreign Investment Promotion Plans Plan to Boost Competitiveness of Korea’s Exchange Market Government to Improve Household Debt Management Efficiency Government to Reform Foreign Exchange Transaction Regulations FDI Down 14.2% in First Half of 2015 Korea to Cut Emissions 37% by 2030 Trade Surplus Reaches Record High in First Half of 2015 Korea Allotted 3.81% Share in AIIB Deputy Prime Minister Choi Holds Meeting with Foreign Journalists

Economic News Briefing

50

Economic News Briefing

Foreign Investment Promotion Plans The government announced plans to promote Korean foreign investment on June 29, which cover plans to promote Korean foreign portfolio investment, overseas M&As and public sector participation in foreign investment.

The government will launch a Foreign Portfolio Investment Fund, a 10 year tax exempt fund which is not subject to capital gains taxes on equity investment returns and foreign exchange gains, and invests more than 60 percent of its capital in foreign equities. In addition, regulations applied to insurance companies regarding foreign exchange hedging and foreign investment will be eased: assets not hedged against foreign exchange risks have been considered not to have any time remaining to maturity, but part of the time remaining to maturity will be counted.

Investment in emerging market bonds, which had been banned as those bonds do not have credit ratings given by global credit agencies, will be allowed in the future.

To promote overseas M&As, the government will ease regulations and provide support of up to US $5 billion

for overseas M&As by utilizing the Foreign Exchange Stabilization Fund. Regarding public sector investment, the government will streamline fund management regulations applied to the Korea Investment Corporation (KIC) to support the management of small trust accounts, while encouraging small- and medium-sized pension funds to open trust accounts in the KIC.

Plan to Boost Competitiveness of Korea’s Exchange Market The Financial Services Commission (FSC) unveiled on July 2 its plan to improve the global competitiveness of Korea’s exchange markets. The FSC will transform the Korea Exchange (KRX) into a holding company that owns the KOSPI, KOSDAQ and derivatives markets as separate entities. The KRX holding company will pursue an initial public offering (IPO), to seek profits and to raise funds for expansion into overseas markets.

The holding company will make moves to enter overseas markets through M&As or joint ventures with global exchanges. The FSC will also focus on fostering the KOSDAQ by attracting promising ventures and introducing new products and services.

As part of efforts to improve the global competitiveness of Korea's exchange markets, the FSC will transform the KRX into a holding company that owns the KOSPI, KOSDAQ and derivatives markets as separate entities.

51

ECONOMIC BULLETIN • july 2015

Government to Improve Household Debt Management Efficiency The government announced a new round of household debt management measures that focus on reducing risks in loan agreement, such as extending the portion of amortized loans and strictly enforcing the ability-to-repay rule. Lenders will also be required to increase the portion of fixed interest rate loans in order for households to be prepared of possible rate hikes. Cooperative financial institutions will be required to tighten nonresidential mortgage underwriting standards.

The government will also require banks to increase capital buffers taking into consideration their household debt levels, will introduce nonrecourse loans as a pilot program and regularly monitor the household debt situation, in order to continue to improve the soundness of household debt.

Meanwhile, the government will strengthen safety precautions for the foreign exchange system by improving monitoring and analysis of foreign exchange transactions, as well as strengthening penalties for illegal foreign exchange transactions.

FDI Down 14.2% in First Half of 2015 FDI in the first half of 2015 was US $8.87 billion, down 14.2 percent from the previous year but the second-largest amount ever. Investment from the Middle East surged 4,095.7 percent year-on-year to US $1.34 billion, as a result of large scale M&A investments. However, investments from other major regions declined. FDI fell sharply in the first quarter of 2015 (down 29.8%, y-o-y), but picked up in the second quarter (up 49.9%, q-o-q), led by investment from the Middle East, EU, China and Japan. A rise in M&As and investment from the Middle East contributed to FDI growth in the second quarter.

Government to Reform Foreign Exchange Transaction Regulations The government announced measures to reform foreign exchange transaction regulations on June 29, aiming to make foreign exchange transactions more convenient for individuals and companies, and also to enhance the competitiveness of the financial industry.

The foreign currency transaction process will be simplified, and reporting requirements for transactions related to Korean foreign direct investment (FDI) and overseas real estate acquisitions will be eased. New types of foreign exchange businesses will be developed, such as allowing payment gateway companies to perform electronic cross-border foreign currency transactions and nonbank nonfinancial companies to conduct crossborder foreign currency transactions as long as they adhere to appropriate regulatory protections.

Korea to Cut Emissions 37% by 2030 The government finalized its plan to reduce greenhouse gas emissions by 37 percent from the expected business-as-usual (BAU) level by 2030. The government had previously outlined four scenarios with different reduction rates, ranging from 14.7 percent to 31.3 percent, for Korea̕ s emissions target, but ultimately decided on a higher reduction rate after considering the country’s leadership role in global greenhouse gas reduction efforts and the need to foster new energy industries. In order to minimize damage to businesses, the industrial sector will be responsible for no more than 12 percent of the emissions cut, and the government will encourage voluntary greenhouse gas emissions reduction among businesses by increasing incentives and reducing regulations.

52

Economic News Briefing

Trade Surplus Reaches Record High in First Half of 2015 Korea’s trade surplus in the first half of 2015 reached an all-time high of US $46.7 billion, as exports declined 5.0 percent year-on-year to US $269.0 billion while imports were down 15.6 percent to US $222.3 billion. A sharp fall in imports, caused by declining commodity prices, contributed to the record high surplus. Exports in the first half of 2015 slowed due to low oil prices and sluggish demand from China, but may pick up in the second half as automobile and mobile phone companies have released new products.

Korea Allotted 3.81% Share in AIIB Deputy Prime Minister Choi Kyung Hwan signed the Asia Infrastructure Investment Bank (AIIB) Agreement on June 29 in Beijing, China, along with representatives of 56 other member nations. The AIIB will have an authorized capital stock of US $100 billion, 20 percent of which will be paid-in capital. Among Korea’s total

contribution of US $3.74 billion, the paid-in capital amounts to US $750 million and will be paid over the next five years. Korea received a 3.81 percent share in the new institution, ranking fifth among the 57 founding members.

Deputy Prime Minister Choi Holds Meeting with Foreign Journalists On July 21, Deputy Prime Minister Choi held a meeting with foreign journalists at the Seoul Foreign Correspondents Club where he delivered a keynote speech on recent economic developments in the global and Korean economies as well as the government’s key economic policies for the second half of 2015.

Following his speech, the Deputy Prime Minister answered questions from the audience, including those on Korean foreign investment, household debt and market-based restructuring in the corporate sector. In his closing remarks, the Deputy Prime Minister emphasized the government’s strong commitment to boosting Korea’s economic recovery and the tourism industry, while giving his assurance that MERS has effectively been controlled.

Delegates pose for a group photo at the signing ceremony of the Articles of Agreement of the AIIB in Beijing on June 29.

53

ECONOMIC BULLETIN • july 2015

01. National accounts 02. Production, shipment and inventory 03. Production capacity and operation ratio 04. Consumer goods sales index 05. Consumer goods shipment index and consumer sentiment index 06. Machinery orders received and estimated facility investment index 07. Value of construction completed and domestic construction orders received 08. Composite indices of business cycle indicators and BSI 09. Balance of payments (I) 10. Balance of payments (II) 11. Prices 12. Employment 13. Financial indicators 14. Monetary indicators 15. Exchange rates

Statistical Appendices

54

Statistical Appendices

1. National accounts (year-on-year change, %, chained 2010 year prices)

Real GDP

Final consumption Agri., fores. & Manufacturing expenditure fisheries

Period

Gross fixed capital formation Construction

Facilities

2006 2007 2008 2009 2010 2011 2012 2013 2014P

5.2 5.5 2.8 0.7 6.5 3.7 2.3 2.9 3.3

1.6 4.1 5.6 3.2 -4.3 -2.0 -0.9 3.1 2.6

7.7 8.4 3.7 -0.5 13.7 6.5 2.4 3.6 4.0

5.2 5.3 2.2 1.3 4.3 2.7 2.2 2.2 2.0

3.6 5.0 -0.9 0.3 5.5 0.8 -0.5 3.3 3.1

0.7 1.5 -2.7 3.5 -3.7 -3.4 -3.9 5.5 1.0

8.4 9.7 -0.2 -7.7 22.0 4.7 0.1 -0.8 5.8

2006 Ⅰ Ⅱ Ⅲ Ⅳ

6.3 4.7 2.1 4.8

4.1 -0.2 -1.3 4.2

9.6 7.4 8.2 6.1

5.9 5.1 4.7 5.0

3.0 0.7 4.3 5.9

1.7 -4.1 -0.3 5.4

4.6 8.8 13.5 6.8

2007 Ⅰ Ⅱ Ⅲ Ⅳ

4.7 5.6 5.1 6.3

1.7 7.0 8.1 -0.6

6.5 8.6 7.4 10.9

5.2 5.6 5.5 5.0

6.6 6.3 2.1 5.2

3.8 2.0 0.0 0.9

10.3 14.2 2.1 12.2

2008 Ⅰ Ⅱ Ⅲ Ⅳ

5.5 4.1 3.9 -1.6

7.7 4.6 4.3 6.4

8.2 7.1 6.1 -5.3

4.7 3.1 2.4 -1.4

1.8 0.9 2.3 -7.0

-2.0 -0.7 0.2 -7.3

7.0 1.4 5.6 -13.0

2009 Ⅰ Ⅱ Ⅲ Ⅳ

-1.9 -1.1 0.9 4.8

2.5 0.0 5.0 5.0

-8.4 -5.7 1.6 10.4

-1.9 0.9 1.7 4.5

-5.4 -1.1 0.8 5.8

1.9 4.4 3.1 4.1

-19.4 -13.6 -5.9 9.5

2010 Ⅰ Ⅱ Ⅲ Ⅳ

7.2 7.4 5.4 6.0

0.0 -2.2 -7.8 -5.7

16.1 17.2 10.1 11.9

6.2 3.6 3.9 3.4

12.0 6.8 3.8 1.2

1.6 -4.8 -4.8 -5.2

27.6 28.8 20.6 12.9

2011 Ⅰ Ⅱ Ⅲ Ⅳ

4.9 3.6 3.3 3.1

-9.3 -2.5 -5.8 7.1

11.4 6.5 5.6 3.4

3.3 3.3 2.8 1.7

-0.7 2.5 1.7 -0.3

-8.2 -2.5 -2.2 -2.0

8.3 8.3 3.4 -0.9

2012 Ⅰ Ⅱ Ⅲ Ⅳ

2.6 2.4 2.1 2.1

0.1 -1.8 0.0 -1.3

2.7 2.8 2.0 2.0

2.2 1.3 2.7 2.7

6.2 -2.2 -0.9 -3.6

-0.2 -5.3 -2.6 -6.4

11.0 -1.9 -4.2 -3.8

2013 Ⅰ Ⅱ Ⅲ Ⅳ

2.1 2.7 3.2 3.5

-1.2 0.3 4.4 6.8

2.7 3.6 3.8 4.2

1.5 2.2 2.4 2.6

-3.2 4.3 4.9 6.5

1.3 8.9 7.4 3.5

-12.3 -3.2 2.3 11.6

2014PⅠ Ⅱ Ⅲ Ⅳ

3.9 3.4 3.3 2.7

5.6 3.3 1.4 1.3

5.1 5.1 3.3 2.4

2.7 1.7 2.0 1.8

5.8 3.3 3.3 0.7

4.1 0.2 2.3 -1.5

7.2 7.7 4.2 4.2

2015PⅠ

2.5

6.3

0.7

1.9

2.4

0.6

5.8

P: Preliminary Source: The Bank of Korea

55

ECONOMIC BULLETIN • july 2015

2. Production, shipment and inventory (constant prices, 2010=100)

Period

Production index

Shipment index

y-o-y change(%)

Inventory index

y-o-y change(%)

Service production index

y-o-y change(%)

y-o-y change(%)

2012 2013 2014

107.4 108.2 108.2

1.3 0.7 0.0

107.2 108.1 107.9

1.5 0.8 -0.2

125.2 130.7 128.4

4.4 4.4 -1.8

104.8 106.4 108.7

1.6 1.5 2.2

2012 Ⅰ Ⅱ Ⅲ Ⅳ

106.6 108.9 103.7 110.6

3.9 1.3 -0.3 0.8

106.6 108.4 103.8 109.8

3.1 1.7 0.6 0.5

117.7 114.8 114.5 125.2

12.2 4.6 2.0 4.4

102.0 104.9 104.8 107.6

2.6 1.5 1.6 0.8

2013 Ⅰ Ⅱ Ⅲ Ⅳ

106.0 109.3 104.3 113.0

-0.6 0.4 0.6 2.2

106.1 109.4 104.5 112.2

-0.5 0.9 0.7 2.2

123.1 119.2 124.5 130.7

4.6 3.8 8.7 4.4

103.2 106.8 105.6 110.0

1.2 1.8 0.8 2.1

2014 Ⅰ Ⅱ Ⅲ Ⅳ

106.7 109.8 105.5 110.9

0.7 0.5 1.2 -1.9

106.5 109.3 104.8 111.0

0.4 -0.1 0.3 -1.1

130.0 128.9 129.7 128.4

5.6 8.1 4.2 -1.8

105.3 108.4 108.3 112.9

2.0 1.5 2.6 2.6

2015 Ⅰ

105.7

-0.9

105.9

-0.6

133.7

2.8

108.2

2.9

2013 1 2 3 4 5 6 7 8 9 10 11 12

111.2 97.3 109.6 109.5 110.6 107.8 108.0 103.9 101.1 113.3 112.2 113.4

9.0 -8.3 -1.8 2.5 -0.1 -1.3 1.9 3.6 -3.4 4.1 -0.4 2.8

110.0 98.2 110.2 109.3 110.3 108.6 107.1 104.9 101.4 112.6 111.4 112.6

7.0 -7.4 -0.7 2.9 0.4 -0.5 1.8 5.0 -4.5 4.1 0.4 2.3

128.6 124.6 123.1 120.7 121.7 119.2 124.0 123.5 124.5 126.3 129.1 130.7

7.8 6.1 4.6 3.6 3.0 3.8 7.5 3.5 8.7 8.8 6.4 4.4

102.4 100.4 106.7 105.6 107.7 107.0 105.6 105.7 105.4 107.8 107.4 114.7

2.1 0.5 0.9 2.7 1.6 1.0 0.8 1.7 -0.3 2.9 1.8 1.8

2014 1 2 3 4 5 6 7 8 9 10 11 12

106.2 101.0 112.9 112.4 108.4 108.5 112.3 101.2 103.1 109.8 108.3 114.7

-4.5 3.8 3.0 2.6 -2.0 0.6 4.0 -2.6 2.0 -3.1 -3.5 1.1

105.1 101.3 113.1 111.3 108.7 107.8 109.5 101.7 103.2 109.0 109.2 114.9

-4.5 3.2 2.6 1.8 -1.5 -0.7 2.2 -3.1 1.8 -3.2 -2.0 2.0

132.1 129.3 130.0 131.2 130.0 128.9 133.2 130.6 129.7 130.7 129.7 128.4

2.7 3.8 5.6 8.7 6.8 8.1 7.4 5.7 4.2 3.5 0.5 -1.8

104.7 101.8 109.4 106.9 108.8 109.6 108.7 107.9 108.3 110.6 109.8 118.4

2.2 1.4 2.5 1.2 1.0 2.4 2.9 2.1 2.8 2.6 2.2 3.2

2015 1 2 3 4P 5P

108.1 96.0 113.0 109.5 105.4

1.8 -5.0 0.1 -2.6 -2.8

108.1 96.6 113.1 109.5 105.8

2.9 -4.6 0.0 -1.6 -2.7

132.4 133.0 133.7 135.7 135.5

0.2 2.9 2.8 3.4 4.2

107.1 104.6 113.0 111.2 111.4

2.4 2.8 3.3 4.0 2.4

P: Preliminary Source: Statistics Korea

56

Statistical Appendices

3. Production capacity and operation ratio Period

Production capacity index (2010=100)

Operation ratio index (2010=100)

y-o-y change (%)

y-o-y change (%)

Average operation ratio (%)

2012 2013 2014

106.9 108.6 110.3

2.1 1.6 1.6

97.5 95.1 94.2

-2.7 -2.5 -0.9

78.6 76.5 76.1

2012 Ⅰ Ⅱ Ⅲ Ⅳ

106.3 106.7 107.0 107.5

2.7 2.1 1.9 1.8

97.5 101.0 93.2 98.3

-0.3 -2.4 -4.6 -3.5

79.9 79.5 76.6 78.0

2013 Ⅰ Ⅱ Ⅲ Ⅳ

108.1 108.3 108.8 109.3

1.7 1.5 1.7 1.7

93.7 97.9 90.8 98.3

-3.9 -3.1 -2.6 0.0

77.3 76.1 75.4 77.0

2014 Ⅰ Ⅱ Ⅲ Ⅳ

109.6 109.9 110.6 111.0

1.4 1.5 1.7 1.6

92.8 96.8 91.5 95.8

-1.0 -1.1 0.8 -2.5

77.1 76.1 76.0 75.1

2015 Ⅰ

111.2

1.5

90.1

-2.9

74.4

2013 1 2 3 4 5 6 7 8 9 10 11 12

108.0 108.1 108.1 108.1 108.3 108.5 108.6 108.9 108.9 109.1 109.2 109.6

1.7 1.8 1.6 1.4 1.5 1.6 1.8 1.6 1.8 1.7 1.6 1.9

98.9 84.9 97.2 97.9 99.4 96.3 94.6 90.7 87.0 99.7 98.2 96.9

6.9 -12.7 -5.5 -1.0 -3.1 -5.0 -2.7 2.7 -7.5 1.6 -2.5 0.8

78.8 77.3 75.9 75.8 76.4 76.2 74.7 76.8 74.8 77.0 76.5 77.4

2014 1 2 3 4 5 6 7 8 9 10 11 12

109.7 109.5 109.7 109.6 109.9 110.1 110.4 110.7 110.8 110.9 110.9 111.1

1.6 1.3 1.5 1.4 1.5 1.5 1.7 1.7 1.7 1.6 1.6 1.4

91.9 87.5 99.0 99.8 95.6 94.9 98.7 86.8 88.9 95.8 94.1 97.6

-7.1 3.1 1.9 1.9 -3.8 -1.5 4.3 -4.3 2.2 -3.9 -4.2 0.7

77.8 76.3 77.2 77.2 74.9 76.3 77.9 74.7 75.4 74.2 74.6 76.6

2015 1 2 3 4P 5P

111.1 111.0 111.5 111.2 111.2

1.3 1.4 1.6 1.5 1.2

93.0 81.1 96.3 95.8 92.2

1.2 -7.3 -2.7 -4.0 -3.6

74.1 75.1 73.9 74.1 73.4

P: Preliminary Source: The Bank of Korea

57

ECONOMIC BULLETIN • july 2015

4. Consumer goods sales index (constant prices, 2010=100)

Period

y-o-y change (%)

Consumer goods sales index Durable goods Semi-durable goods y-o-y y-o-y change (%) change (%)

Nondurable goods y-o-y change (%)

2012 2013 2014

107.1 107.9 109.7

2.5 0.7 1.7

116.3 116.6 122.6

5.4 0.3 5.1

103.9 106.1 105.5

-0.3 2.1 -0.6

104.3 104.7 105.5

2.2 0.4 0.8

2012 Ⅰ Ⅱ Ⅲ Ⅳ

103.5 106.5 106.7 111.8

2.9 1.5 2.9 2.7

109.4 115.0 118.5 122.1

4.0 2.7 6.5 8.4

99.0 105.6 92.4 118.4

0.6 -0.4 -2.2 0.5

102.8 103.0 107.5 104.1

3.3 1.9 3.1 0.8

2013 Ⅰ Ⅱ Ⅲ Ⅳ

103.8 107.7 107.2 113.0

0.3 1.1 0.5 1.1

111.0 118.2 116.8 120.3

1.5 2.8 -1.4 -1.5

102.1 107.3 94.9 119.9

3.1 1.6 2.7 1.3

101.2 102.9 108.0 106.6

-1.6 -0.1 0.5 2.4

2014 Ⅰ Ⅱ Ⅲ Ⅳ

106.3 108.6 108.8 115.1

2.4 0.8 1.5 1.9

117.2 121.2 123.4 128.6

5.6 2.5 5.7 6.9

100.3 104.9 96.2 120.4

-1.8 -2.2 1.4 0.4

103.8 104.3 107.5 106.5

2.6 1.4 -0.5 -0.1

2015 Ⅰ

108.0

1.6

126.6

8.0

98.7

-1.6

103.4

-0.4

2013 1 2 3 4 5 6 7 8 9 10 11 12

104.6 99.5 107.3 105.4 110.9 106.8 109.2 104.5 107.8 111.3 113.2 114.6

-2.8 1.6 2.1 2.2 0.6 0.6 0.7 2.0 -1.4 2.0 1.3 0.1

112.3 105.9 114.8 115.1 119.7 119.9 127.5 116.2 106.8 120.5 120.2 120.1

4.7 -1.2 0.9 7.2 2.0 -0.2 1.4 1.8 -7.8 2.9 -2.4 -4.7

102.8 93.3 110.2 106.7 113.8 101.3 98.0 86.6 100.1 113.9 123.8 122.1

-1.9 1.5 9.8 1.7 2.2 0.9 0.6 5.4 2.6 -0.8 4.1 0.4

101.7 99.3 102.5 100.3 105.5 103.0 105.6 106.8 111.6 105.8 105.3 108.8

-6.7 3.2 -0.6 0.0 -0.8 0.7 0.4 0.8 0.3 2.8 1.9 2.6

2014 1 2 3 4 5 6 7 8 9 10 11 12

110.4 99.1 109.3 105.6 112.1 108.1 109.9 107.1 109.3 111.1 114.3 119.9

5.5 -0.4 1.9 0.2 1.1 1.2 0.6 2.5 1.4 -0.2 1.0 4.6

116.1 116.9 118.5 114.2 121.8 127.5 131.1 118.5 120.5 118.9 128.7 138.1

3.4 10.4 3.2 -0.8 1.8 6.3 2.8 2.0 12.8 -1.3 7.1 15.0

100.7 92.0 108.2 105.8 111.8 97.2 95.7 91.5 101.5 116.0 120.6 124.7

-2.0 -1.4 -1.8 -0.8 -1.8 -4.0 -2.3 5.7 1.4 1.8 -2.6 2.1

111.9 93.9 105.5 101.5 107.7 103.7 106.3 108.6 107.5 105.4 104.9 109.3

10.0 -5.4 2.9 1.2 2.1 0.7 0.7 1.7 -3.7 -0.4 -0.4 0.5

2015 1 2 3 4P 5P

107.3 104.4 112.4 110.8 116.0

-2.8 5.3 2.8 4.9 3.5

128.2 117.2 134.5 129.3 130.9

10.4 0.3 13.5 13.2 7.5

97.9 92.6 105.7 107.6 116.2

-2.8 0.7 -2.3 1.7 3.9

101.7 103.6 105.0 103.5 108.8

-9.1 10.3 -0.5 2.0 1.0

P: Preliminary Source: Statistics Korea

58

Statistical Appendices

5. Consumer goods shipment index and consumer sentiment index Domestic consumer goods shipment index (2010=100) Durable goods Nondurable goods y-o-y y-o-y y-o-y change (%) change (%) change (%)

Period

Consumer sentiment index

2012 2013 2014

102.5 102.2 101.8

1.6 -0.3 -0.4

102.8 103.4 102.6

2.5 0.6 -0.8

102.4 101.7 101.5

1.2 -0.7 -0.2

-

2012 Ⅰ Ⅱ Ⅲ Ⅳ

100.8 99.9 103.5 106.0

-0.2 2.0 2.0 2.6

97.8 99.1 102.5 112.0

-1.7 -1.6 1.6 11.9

102.0 100.2 103.9 103.4

0.4 3.5 2.2 -1.1

-

2013 Ⅰ Ⅱ Ⅲ Ⅳ

103.0 98.7 102.4 104.7

2.2 -1.2 -1.1 -1.2

108.3 100.9 102.6 101.8

10.7 1.8 0.1 -9.1

100.8 97.7 102.3 105.9

-1.2 -2.5 -1.5 2.4

-

2014 Ⅰ Ⅱ Ⅲ Ⅳ

100.7 100.3 102.4 103.9

-2.2 1.6 0.0 -0.8

103.4 103.0 100.9 103.2

-4.5 2.1 -1.7 1.4

99.5 99.2 103.0 104.2

-1.3 1.5 0.7 -1.6

-

2015 Ⅰ

101.8

1.1

99.9

-3.4

102.5

3.0

-

2013 1 2 3 4 5 6 7 8 9 10 11 12

108.8 96.9 103.3 99.5 99.7 96.9 103.4 104.0 99.7 108.8 102.9 102.3

8.2 -1.7 0.2 0.3 -1.9 -2.0 0.6 2.5 -6.0 2.1 -2.6 -3.2

110.3 106.4 108.1 98.1 101.7 102.8 109.0 103.8 94.9 104.4 103.1 97.8

19.2 8.2 5.5 4.3 1.3 0.0 3.5 5.5 -8.7 -3.8 -7.0 -16.1

108.1 92.9 101.3 100.0 98.8 94.4 101.1 104.2 101.7 110.7 102.8 104.2

3.9 -5.9 -1.9 -1.3 -3.2 -3.0 -0.7 1.3 -5.0 4.7 -0.7 3.1

102 102 104 102 104 105 105 105 102 106 107 107

2014 1 2 3 4 5 6 7 8 9 10 11 12

102.4 96.6 103.0 101.7 99.8 99.5 104.8 100.2 102.2 105.0 100.9 105.8

-5.9 -0.3 -0.3 2.2 0.1 2.7 1.4 -3.7 2.5 -3.5 -1.9 3.4

99.9 106.7 103.6 97.9 103.4 107.7 107.6 95.0 100.1 99.8 102.9 106.8

-9.4 0.3 -4.2 -0.2 1.7 4.8 -1.3 -8.5 5.5 -4.4 -0.2 9.2

103.4 92.3 102.8 103.3 98.2 96.1 103.7 102.4 103.0 107.3 100.0 105.4

-4.3 -0.6 1.5 3.3 -0.6 1.8 2.6 -1.7 1.3 -3.1 -2.7 1.2

109 108 108 108 105 107 105 107 107 105 103 101

2015 1 2 3 4P 5P 6

104.8 94.5 106.0 105.5 98.9 -

2.3 -2.2 2.9 3.7 -0.9 -

101.2 92.8 105.8 107.1 98.6 -

1.3 -13.0 2.1 9.4 -4.6 -

106.3 95.2 106.1 104.8 99.0 -

2.8 3.1 3.2 1.5 0.8 -

102 103 101 104 105 99

P: Preliminary Source: Statistics Korea

59

ECONOMIC BULLETIN • july 2015

6. Machinery orders received and estimated facility investment index Domestic machinery orders received excluding ship (billion won, constant value) Total Public Private Estimated facility investment index y-o-y y-o-y y-o-y y-o-y change (%) (2010=100) change (%) change (%) change (%)

Period 2012 2013 2014

21,648 23,078 26,485

-13.9 6.6 14.8

2,142 2,580 5,012

-11.0 20.5 94.2

19,506 20,497 21,473

-14.2 5.1 4.8

100.6 99.8 105.0

-2.8 -0.8 5.2

2012 Ⅰ Ⅱ Ⅲ Ⅳ

6,310 5,391 5,036 4,910

-1.1 -19.8 -11.1 -23.0

810 285 579 468

126.1 -59.7 86.7 -54.6

5,500 5,106 4,458 4,442

-8.7 -15.1 -16.8 -16.9

105.0 104.8 96.2 96.4

8.2 -4.2 -7.9 -6.4

2013 Ⅰ Ⅱ Ⅲ Ⅳ

5,587 5,865 5,144 6,481

-11.5 8.8 2.1 32.0

429 554 522 1,075

-47.0 94.2 -9.7 129.7

5,158 5,311 4,622 5,406

-6.2 4.0 3.7 21.7

91.7 101.1 99.3 107.0

-12.7 -3.5 3.2 11.0

2014 Ⅰ Ⅱ Ⅲ Ⅳ

6,624 6,099 7,687 6,075

18.5 4.0 49.4 -6.3

1,221 305 2,708 778

184.6 -45.0 418.5 -27.6

5,403 5,794 4,979 5,297

4.7 9.1 7.7 -2.0

98.6 107.9 100.8 112.8

7.5 6.7 1.5 5.4

2015 Ⅰ

6,453

-2.6

405

-66.9

6,048

12.0

106.9

8.4

2013 1 2 3 4 5 6 7 8 9 10 11 12

1,844 1,666 2,078 1,846 2,127 1,893 1,934 1,622 1,588 2,604 2,094 1,783

-4.6 -34.5 13.2 0.0 16.2 10.3 5.4 7.5 -6.2 72.3 26.5 2.3

139 168 121 92 250 212 359 92 71 788 163 124

169.8 -75.8 92.2 63.8 542.9 11.5 15.8 -45.5 -28.5 815.5 28.2 -51.4

1,704 1,497 1,957 1,753 1,877 1,681 1,575 1,530 1,517 1,816 1,931 1,659

-9.4 -18.9 10.4 -2.0 4.8 10.2 3.3 14.2 -4.8 27.4 26.3 11.5

90.1 83.9 101.0 98.7 102.1 102.5 108.4 100.6 88.8 109.6 101.9 109.4

-7.8 -23.1 -6.7 -7.1 -3.5 0.2 2.8 11.7 -4.6 16.0 10.3 7.0

2014 1 2 3 4 5 6 7 8 9 10 11 12

1,748 1,847 3,029 2,276 1,826 1,997 1,779 4,090 1,818 1,932 2,303 1,840

-5.2 10.9 45.8 23.3 -14.1 5.5 -8.0 152.2 14.5 -25.8 10.0 3.2

88 120 1,013 97 116 92 89 2,541 79 211 428 139

-36.9 -28.8 735.6 5.1 -53.4 -56.7 -75.3 2,653.2 10.6 -73.2 162.6 12.5

1,660 1,727 2,016 2,179 1,709 1,906 1,690 1,549 1,739 1,722 1,874 1,701

-2.6 15.3 3.0 24.3 -8.9 13.4 7.3 1.3 14.7 -5.2 -2.9 2.5

90.3 95.6 109.8 110.6 108.3 104.9 111.4 90.7 100.2 99.8 112.5 126.0

0.2 13.9 8.7 12.1 6.1 2.3 2.8 -9.8 12.8 -8.9 10.4 15.2

2015 1 2 3 4P 5P

2,324 1,856 2,273 2,782 2,101

32.9 0.5 -24.9 22.2 15.1

116 141 148 127 194

32.0 17.6 -85.4 30.7 66.3

2,208 1,715 2,126 2,655 1,907

33.0 -0.7 5.5 21.8 11.6

102.7 98.6 119.5 113.5 109.2

13.7 3.1 8.8 2.6 0.8

P: Preliminary Source: Statistics Korea

60

Statistical Appendices

7. Value of construction completed and domestic construction orders received (current value, billion won)

Period

Value of construction completed y-o-y (Total) change (%)

Type of order Public Private

Domestic construction orders y-o-y received change (%) y-o-y change (%) (Total)

y-o-y change (%)

Type of order Public Private y-o-y change (%)

y-o-y change (%)

2012 2013 2014

88,713 98,089 98,465

-3.3 10.6 0.4

33,807 34,459 32,004

-3.7 1.9 -7.1

50,622 59,714 62,403

-2.0 18.0 4.5

89,395 77,885 89,833

-6.2 -12.9 15.3

26,071 24,736 26,497

-8.9 -5.1 7.1

59,811 50,947 61,321

-3.3 -14.8 20.4

2012 Ⅰ Ⅱ Ⅲ Ⅳ

19,275 22,410 21,351 25,676

0.0 -6.8 -0.3 -4.8

7,442 8,892 7,598 9,876

1.6 -4.3 -1.1 -8.8

10,893 12,440 12,676 14,613

-1.2 -6.7 0.6 -0.6

22,671 25,732 18,395 22,596

38.8 1.6 -10.0 -32.0

5,655 5,570 5,401 9,443

37.3 -11.7 -19.5 -17.8

16,309 19,100 12,522 11,877

46.8 8.2 -2.7 -41.2

2013 Ⅰ Ⅱ Ⅲ Ⅳ

20,178 25,760 23,718 28,732

4.7 14.9 11.1 10.7

6,998 9,318 8,058 10,085

-6.0 4.8 6.0 2.1

12,415 15,455 14,739 17,106

14.0 24.2 16.3 17.1

13,826 18,694 16,833 28,532

-39.0 -27.4 -8.5 26.3

4,292 5,371 4,987 10,086

-24.1 -3.6 -7.7 6.8

9,180 12,636 11,442 17,688

-43.7 -33.8 -8.6 48.9

2014 Ⅰ Ⅱ Ⅲ Ⅳ

21,675 26,174 23,601 27,016

7.4 1.6 -0.5 -5.0

7,147 8,706 7,243 8,909

2.1 -6.6 -10.1 -11.7

13,676 16,512 15,360 16,855

10.2 6.8 4.2 -1.5

15,972 23,436 24,035 26,390

15.5 25.4 42.8 -7.5

5,898 6,577 5,190 8,833

37.4 22.5 4.1 -12.4

9,628 16,537 18,175 16,982

4.9 30.9 58.8 -4.0

2015 Ⅰ

21,252

-2.0

6,554

-8.3

13,949

2.0

24,821

55.4

4,566

-22.6

19,980 107.5

2013 1 2 3 4 5 6 7 8 9 10 11 12

6,272 6,236 7,670 81,057 81,607 94,947 7,854 7,666 8,199 8,637 9,088 10,708

8.2 3.3 3.0 18.4 11.7 15.0 11.6 16.5 6.0 17.6 12.2 4.6

2,072 2,346 2,581 2,830 2,797 3,691 2,635 2,553 2,870 2,952 3,118 4,015

-2.4 -1.1 -12.4 7.0 -2.7 9.4 11.1 10.0 -1.2 13.9 3.8 -6.2

3,962 3,662 4,790 4,978 5,088 5,389 4,908 4,827 5,004 5,344 5,635 6,126

17.4 7.5 16.4 27.5 23.9 21.6 14.7 22.4 12.4 20.0 18.1 13.7

3,557 4,723 5,546 5,151 6,221 7,321 5,775 4,690 6,368 7,751 8,083 12,698

-52.4 -44.4 -17.4 -19.9 -14.9 -39.0 -15.4 -13.0 3.0 33.6 11.6 32.9

1,300 1,281 1,711 1,565 1,564 2,241 1,493 1,474 2,021 1,518 2,664 5,904

-36.1 -42.3 21.9 7.7 47.4 -26.7 -35.2 12.0 13.5 -23.0 26.5 10.0

2,109 3,290 3,781 3,160 4,537 4,940 4,148 3,172 4,122 6,144 5,204 6,340

2014 1 2 3 4 5 6 7 8 9 10 11 12

7,057 6,665 7,953 8,476 8,191 9,506 7,914 7,721 7,966 8,239 8,339 10,438

12.5 6.9 3.7 4.6 0.4 0.1 0.8 0.7 -2.8 -4.6 -8.2 -2.5

2,314 2,207 2,626 2,740 2,584 3,382 2,429 2,324 2,491 2,532 2,673 3,704

11.7 -6.0 1.8 -3.2 -7.6 -8.4 -7.8 -9.0 -13.2 -14.2 -14.3 -7.8

4,452 4,237 4,987 5,458 5,316 5,737 5,149 5,112 5,099 5,369 5,293 6,194

12.4 15.7 4.1 9.6 4.5 6.5 4.9 5.9 1.9 0.5 -6.1 1.1

5,528 5,549 4,895 7,359 6,834 9,243 6,969 8,688 8,377 7,755 6,427 12,209

55.4 17.5 -11.7 42.9 9.9 26.2 20.7 85.2 31.6 0.0 -20.5 -3.9

2,034 2,241 1,623 1,894 2,000 2,682 1,533 1,628 2,029 1,416 1,895 5,522

56.4 75.0 -5.1 21.0 27.8 19.7 2.7 10.5 0.4 -6.7 -28.9 -6.5

3,305 56.7 3,158 -4.0 3,165 -16.3 5,454 72.6 4,767 5.1 6,316 27.8 5,298 27.7 6,849 115.9 6,029 46.3 6,157 0.2 4,415 -15.2 6,410 1.1

2015 1 2 3 4P 5P

6,774 6,681 7,796 7,709 7,751

-4.0 0.2 -2.0 -9.1 -5.4

1,997 2,089 2,468 2,469 2,325

-13.7 -5.3 -6.0 -9.9 -10.0

4,561 4,374 5,014 4,936 5,121

2.4 3.2 0.5 -9.6 -3.7

7,216 5,367 12,238 8,876 12,608

30.5 -3.3 150.0 20.6 84.5

1,297 1,133 2,136 2,581 2,419

-36.2 -49.4 31.6 36.3 20.9

5,882 78.0 4,115 30.3 9,882 215.4 6,239 14.4 10,086 111.6

P: Preliminary Source: Statistics Korea

-60.0 -46.3 -23.1 -29.2 -26.0 -41.9 -4.2 -21.3 -0.9 62.2 8.5 92.7

61

ECONOMIC BULLETIN • july 2015

8. Composite indices of business cycle indicators and BSI Period

Leading index (2010=100)

Cyclical indicator of leading index (2010=100)

Cyclical Coincident index indicator of (2010=100) coincident index (2010=100)

BSI (results)

BSI (prospects)

2011 1 2 3 4 5 6 7 8 9 10 11 12

101.5 101.7 101.8 101.4 101.7 102.2 102.8 103.0 103.1 103.3 103.5 103.8

101.0 100.7 100.3 99.5 99.4 99.4 99.5 99.2 99.0 98.7 98.4 98.3

103.5 103.5 104.0 104.0 104.9 105.6 106.2 106.7 106.8 107.2 107.3 107.7

101.7 101.4 101.4 101.1 101.5 101.8 101.9 102.0 101.6 101.6 101.2 101.2

99.1 92.2 107.8 98.4 98.9 99.6 96.2 86.8 96.4 95.0 93.0 90.1

101.8 98.0 113.5 99.3 104.3 104.3 101.3 98.9 96.3 101.4 96.4 94.8

2012 1 2 3 4 5 6 7 8 9 10 11 12

104.6 105.7 106.2 106.6 106.7 107.8 108.3 108.4 108.1 108.5 109.3 110.1

98.5 99.2 99.1 99.1 98.7 99.3 99.3 98.9 98.2 98.1 98.4 98.7

107.7 108.6 108.8 109.2 109.3 109.7 110.5 110.4 110.8 110.9 111.5 112.1

100.8 101.3 101.0 101.0 100.6 100.7 100.9 100.4 100.4 100.0 100.2 100.3

88.6 92.2 101.4 97.5 95.7 90.4 82.1 84.4 89.3 88.9 82.2 87.0

88.3 91.0 106.1 98.4 104.7 98.3 89.7 82.7 99.5 97.0 92.5 82.0

2013 1 2 3 4 5 6 7 8 9 10 11 12

110.4 110.9 111.4 111.9 112.7 113.8 114.5 115.1 115.3 116.2 117.1 118.1

98.5 98.5 98.5 98.6 98.8 99.3 99.5 99.6 99.3 99.6 99.9 100.3

112.4 112.9 113.0 113.6 114.1 114.8 115.2 115.8 116.1 116.8 117.2 117.8

100.2 100.2 99.8 100.0 100.0 100.2 100.2 100.3 100.1 100.3 100.2 100.3

85.0 83.0 101.3 94.1 97.6 95.0 91.1 89.8 93.0 94.7 91.9 90.5

85.7 86.7 104.4 101.5 99.8 97.2 90.7 92.7 94.4 101.1 94.7 92.6

2014 1 2 3 4 5 6 7 8 9 10 11 12

118.7 118.9 119.0 119.4 119.8 120.5 121.1 122.4 123.6 124.4 124.9 125.9

100.4 100.2 99.8 99.7 99.6 99.7 99.8 100.4 101.0 101.2 101.1 101.5

118.5 118.9 119.4 119.6 119.8 120.2 120.8 121.5 121.8 121.9 122.2 123.0

100.5 100.5 100.5 100.3 100.1 100.1 100.2 100.4 100.2 99.9 99.8 100.1

89.4 87.0 100.7 95.8 93.0 91.3 90.8 89.0 92.3 93.1 90.0 95.4

93.4 88.7 104.4 99.5 101.7 94.5 94.0 91.6 93.1 100.7 93.6 94.0

2015 1 2 3 4 5 6 7

127.8 129.0 130.5 131.1 132.1 -

102.5 103.1 103.8 103.8 104.1 -

123.6 124.5 124.7 125.1 125.0 -

100.2 100.5 100.3 100.3 99.8 -

94.0 89.4 101.5 101.3 95.6 79.9 -

90.3 92.1 103.7 97.5 99.4 96.4 84.3

Sources: Statistics Korea, The Bank of Korea

62

Statistical Appendices

9. Balance of payments (I) (US $ million)

Period

Current account

Goods

2012 2013 2014

50,835.0 79,883.6 89,220.1

2012 Ⅰ Ⅱ Ⅲ Ⅳ

Services

Primary income

Secondary income

554,103.2 536,559.0 528,611.3

-5,213.6 -7,927.4 -8,163.4

12,116.7 11,424.8 10,197.7

-5,474.1 -4,182.3 -5,501.8

144,260.1 150,834.0 149,619.5 158,795.6

142,598.6 142,299.0 133,724.9 135,480.7

-2,970.8 172.0 -679.8 -1,735.0

2,045.3 3,942.3 2,972.2 3,156.9

-1,482.0 -1,044.2 -1,300.2 -1,647.7

14,298.0 20,585.3 23,305.7 24,592.0

147,823.3 154,065.9 153,715.8 162,551.9

133,525.3 133,480.6 130,410.1 137,959.9

-2,667.9 647.9 -2,078.5 -2,400.7

1,812.4 1,660.5 2,346.6 3,236.2

-828.2 -546.3 -1,323.4 -1,491.4

15,185.9 24,240.4 22,565.7 27,228.1

17,745.2 26,428.1 21,676.0 26,838.3

152,688.6 159,385.4 153,482.3 155,742.6

134,943.4 132,957.3 131,806.3 128,904.3

-3,503.4 -1,838.7 -904.0 -1,917.3

1,905.8 1,330.9 3,143.5 3,817.5

-961.7 -1,679.9 -1,349.8 -1,510.4

2015P Ⅰ

23,454.5

25,258.2

135,480.6

110,222.4

-5,413.0

4,830.5

-1,221.2

2013 1 2 3 4 5 6 7 8 9 10 11 12

3,075.6 2,473.1 7,065.6 5,334.6 9,886.4 7,126.4 7,323.2 6,745.6 8,181.6 11,108.9 6,229.9 6,597.3

3,953.0 3,256.4 7,088.6 5,510.6 9,363.1 5,711.6 7,462.2 7,271.4 8,572.1 9,767.8 8,024.8 6,799.4

51,765.7 44,916.0 51,141.6 51,704.7 53,477.3 48,883.9 53,326.3 49,899.2 50,490.3 56,820.8 52,702.3 53,028.8

47,812.7 41,659.6 44,053.0 46,194.1 44,114.2 43,172.3 45,864.1 42,627.8 41,918.2 47,053.0 44,677.5 46,229.4

-1,556.6 -1,144.9 33.6 496.2 -28.7 180.4 -879.0 -869.3 -330.2 405.8 -2,088.9 -717.6

1,169.5 623.3 19.6 -482.0 721.6 1,420.9 1,032.7 665.9 648.0 1,335.7 674.8 1,225.7

-490.3 -261.7 -76.2 -190.2 -169.6 -186.5 -292.7 -322.4 -708.3 -400.4 -380.8 -710.2

2014 1 2 3 4 5 6 7 8 9 10 11 12

3,323.7 4,537.5 7,324.7 7,163.1 9,119.2 7,958.1 7,881.7 7,235.1 7,448.9 8,883.2 11,322.1 7,022.8

4,367.0 5,403.4 7,974.8 10,648.0 9,133.5 6,646.6 6,794.4 7,367.3 7,514.3 8,487.1 10,031.4 8,319.8

50,599.8 47,993.3 54,095.5 56,721.4 52,383.0 50,281.0 53,811.7 48,920.1 50,750.5 51,970.8 50,063.0 53,708.8

46,232.8 42,589.9 46,120.7 46,073.4 43,249.5 43,634.4 47,017.3 41,552.8 43,236.2 43,483.7 40,031.6 45,389.0

-1,873.7 -1,020.3 -609.4 -1,004.4 -297.7 -536.6 31.0 -694.3 -240.7 -212.6 -164.6 -1,540.1

1,211.4 371.8 322.6 -1,619.7 725.1 2,225.5 1,488.8 1,048.0 606.7 967.6 1,667.5 1,182.4

-381.0 -217.4 -363.3 -860.8 -441.7 -377.4 -432.5 -485.9 -431.4 -358.9 -212.2 -939.3

2015P 1 2 3 4 5

6,583.0 6,442.2 10,429.3 8,135.7 8,653.2

6,687.0 7,321.2 11,250.0 12,558.0 9,191.3

45,398.8 40,595.3 49,486.5 50,376.1 43,869.2

38,711.8 33,274.1 38,236.5 37,818.1 34,677.9

-2,384.4 -2,061.6 -967.0 -1,125.0 -397.6

2,900.4 1,401.3 528.8 -2,837.5 293.6

-620.0 -218.7 -382.5 -459.8 -434.1

Exports

Imports

49,406.0 80,568.6 92,687.6

603,509.2 617,127.6 621,298.9

-746.0 11,605.1 16,886.8 23,089.1

1,661.5 8,535.0 15,894.6 23,314.9

2013 Ⅰ Ⅱ Ⅲ Ⅳ

12,614.3 22,347.4 22,250.4 23,936.1

2014 Ⅰ Ⅱ Ⅲ Ⅳ

P: Preliminary Source: The Bank of Korea

63

ECONOMIC BULLETIN • july 2015

10. Balance of payments (II) (US $ million)

Capital & financial account

Direct investment

Portfolio investment

Financial derivatives

Other investment

Capital transfers & acquisition of nonfinancial assets

Reserve assets

2012 2013 2014

-51,582.4 -80,104.6 -90,383.3

-21,136.2 -15,593.2 -20,659.5

6,747.8 -9,344.5 -33,605.3

2,627.8 4,410.3 3,704.9

-26,637.3 -43,281.1 -21,937.9

-41.7 -27.0 -9.0

-13,184.5 -16,296.1 -17,885.5

2012 Ⅰ Ⅱ Ⅲ Ⅳ

-4,564.4 -4,278.7 -18,096.1 -24,643.2

-7,579.6 -4,057.3 -5,705.4 -3,793.9

14,759.6 -6,803.0 4,177.7 -5,386.5

1,198.5 -270.6 595.3 1,104.6

-6,495.1 6,181.1 -13,247.2 -13,076.1

-19.2 -6.7 -9.0 -6.8

-6,447.8 671.1 -3,916.5 -3,491.3

2013 Ⅰ Ⅱ Ⅲ Ⅳ

-11,448.7 -19,645.6 -22,675.5 -26,334.8

-3,878.4 -3,397.8 -3,426.8 -4,890.2

-7,285.9 -9,776.5 9,375.4 -1,657.5

1,395.8 -513.6 1,656.3 1,871.8

2,880.2 -10,063.8 -23,611.4 -12,486.1

-2.7 -27.5 12.8 -9.6

-4,560.4 4,106.1 -6,669.0 -9,172.8

2014 Ⅰ Ⅱ Ⅲ Ⅳ

-17177.8 -24,208.1 -22,481.5 -26,515.9

-3,657.7 -7,552.9 -3,908.6 -5,540.3

-13,596.7 -5,867.2 -4,762.4 -9,379.0

892.6 2,083.5 1,531.9 -803.1

6,207.4 -1,701.9 -9,510.4 -16,933.0

-2.1 -4.3 3.6 -6.2

-7,023.4 -11,169.6 -5,832.0 6,139.5

-5,385.9

-7,838.4

41.0

-4,506.4

Period

2015P Ⅰ

-24,799.8

-23.1

-7,110.1

2013 1 2 3 4 5 6 7 8 9 10 11 12

-2,694.7 -1,707.1 -7,046.9 -2,435.7 -12,288.9 -4,921.0 -9,446.1 -6,236.3 -6,993.1 -10,139.4 -7,433.1 -8,762.3

-802.5 -909.3 -2,166.6 401.3 -2,175.6 -1,623.5 -796.8 -1,157.2 -1,472.8 -340.7 -2,243.9 -2,305.6

-5,964.7 2,149.9 -3,471.1 -2,060.8 -1,642.1 -6,073.6 1,785.8 1,584.1 6,005.5 4,942.8 -1,557.9 -5,042.4

579.6 651.0 165.2 -301.1 719.1 -931.6 431.4 210.0 1,014.9 805.3 466.9 599.6

4,123.7 -1,158.3 -85.2 -1,382.5 -8,189.7 -491.6 -8,821.6 -5,172.4 -9,617.4 -10,754.2 -1,248.6 -483.3

-8.0 -2.9 8.2 -1.6 -11.0 -14.9 1.1 18.2 -6.5 -2.0 0.0 -7.6

-630.8 -2,440.4 -1,489.2 907.4 -1,000.6 4,199.3 -2,044.9 -1,700.8 -2,923.3 -4,792.6 -2,849.6 -1,530.6

2014 1 2 3 4 5 6 7 8 9 10 11 12

-4,477.0 -6,920.5 -5,780.3 -6,238.8 -8,132.4 -9,836.9 -5,916.9 -7,802.4 -8,762.2 -6,801.5 -9,915.5 -9,798.9

529.9 -2,163.5 -2,024.1 -2,157.8 -3,338.8 -2,056.3 -1,011.5 -749.5 -2,147.6 -2,088.9 -2,098.2 -1,353.2

-4,193.1 -7,394.4 -2,009.2 1,662.3 -3,311.0 -4,218.5 -1,743.7 504.4 -3,523.1 -382.4 -2,835.6 -6,161.0

155.5 223.1 514.0 858.1 534.5 690.9 504.1 557.7 470.1 -570.7 -81.8 -150.6

1,937.4 4,739.0 -469.0 -5,935.6 3,950.6 283.1 -338.1 -7,288.1 -1,884.2 -4,007.0 -7,797.4 -5,128.6

-3.0 3.5 -2.6 2.6 -4.3 -2.6 -6.3 11.2 -1.3 -1.1 -0.9 -4.2

-2,906.7 -2,324.7 -1,792.0 -665.8 -5,967.7 -4,536.1 -3,327.7 -826.9 -1,677.4 247.5 2,897.5 2,994.5

2015P 1 2 3 4 5

-8,240.4 -5,538.7 -11,020.7 -10,061.9 -8,810.9

-1,001.5 -1,994.5 -2,389.9 -1,971.3 -1,202.7

-3,623.7 -3,001.5 -1,213.2 -138.0 -358.3

-76.2 27.5 89.7 301.9 403.7

489.1 -371.2 -4,624.3 -4,851.0 -4,755.5

-13.0 -1.7 -8.4 -8.5 -1.5

-4,028.1 -199.0 -2,883.0 -3,403.5 -2,898.1

P: Preliminary Source: Statistics Korea

64

Statistical Appendices

11. Prices (2010=100)

Period

Consumer Prices Commodities Services

All Items y-o-y change (%)

y-o-y change (%)

Producer prices All Items Commodities

Core

y-o-y change (%)

y-o-y change (%)

y-o-y change (%)

y-o-y change (%)

2012 2013 2014

106.3 107.7 109.0

2.2 1.3 1.3

108.9 110.1 111.1

3.0 1.0 0.9

104.2 105.8 107.4

1.4 1.5 1.6

104.9 106.6 108.8

1.6 1.6 2.0

107.5 105.7 105.2

0.7 -1.6 -0.5

108.9 106.2 104.8

0.2 -2.5 -1.4

2012 1 2 3 4 5 6 7 8 9 10 11 12

105.7 106.1 106.0 106.0 106.2 106.1 105.9 106.3 107.0 106.9 106.5 106.7

3.4 3.1 2.6 2.5 2.5 2.2 1.5 1.2 2.0 2.1 1.6 1.4

107.9 108.5 109.2 108.9 109.2 108.8 107.9 108.8 110.4 109.8 108.9 109.0

4.4 3.9 4.1 4.1 4.3 3.6 1.9 1.6 3.1 3.0 2.0 1.6

103.9 104.2 103.5 103.7 103.9 104.0 104.2 104.4 104.4 104.6 104.6 104.8

2.7 2.5 1.4 1.3 1.3 1.2 1.1 1.1 1.3 1.4 1.3 1.3

104.6 104.7 104.3 104.4 104.6 104.9 104.9 105.1 105.2 105.2 105.3 105.5

3.2 2.5 1.9 1.8 1.6 1.5 1.2 1.3 1.4 1.5 1.3 1.2

107.7 108.4 108.9 109.0 108.4 107.1 106.6 107.2 107.6 106.8 106.1 105.8

3.2 3.1 2.4 1.9 1.0 0.0 -0.6 -0.1 0.2 -0.5 -0.9 -1.2

109.5 110.5 111.2 111.1 110.3 108.4 107.6 108.6 109.2 107.8 106.8 106.4

3.6 3.6 2.7 1.9 0.7 -0.7 -1.5 -0.9 -0.4 -1.4 -1.9 -2.3

2013 1 2 3 4 5 6 7 8 9 10 11 12

107.3 107.7 107.6 107.5 107.5 107.3 107.6 107.9 108.1 107.8 107.8 107.9

1.6 1.6 1.5 1.3 1.1 1.2 1.6 1.5 1.0 0.9 1.2 1.1

109.9 110.4 110.4 109.9 109.6 109.4 109.7 110.3 110.9 110.1 110.1 110.2

1.7 1.6 1.1 0.9 0.4 0.7 1.7 1.5 0.4 0.3 1.0 0.9

105.3 105.6 105.4 105.6 105.7 105.7 105.9 106.1 106.0 106.0 106.0 106.2

1.5 1.5 1.7 1.7 1.8 1.6 1.5 1.5 1.5 1.4 1.3 1.3

105.9 106.2 106.0 106.0 106.4 106.6 106.7 106.7 107.0 107.1 107.4 107.5

1.3 1.4 1.6 1.6 1.7 1.6 1.7 1.5 1.7 1.8 2.0 1.9

106.0 106.7 106.3 105.9 105.6 105.5 105.5 105.8 105.7 105.3 105.1 105.4

-1.6 -1.6 -2.4 -2.8 -2.6 -1.4 -1.0 -1.3 -1.8 -1.4 -0.9 -0.4

106.8 107.8 107.1 106.6 106.1 106.0 106.0 106.2 106.1 105.5 105.2 105.5

-2.5 -2.5 -3.7 -4.1 -3.8 -2.2 -1.6 -2.1 -2.8 -2.2 -1.5 -0.9

2014 1 2 3 4 5 6 7 8 9 10 11 12

108.5 108.8 109.0 109.1 109.2 109.1 109.3 109.5 109.4 109.1 108.8 108.8

1.1 1.0 1.3 1.5 1.7 1.7 1.6 1.4 1.1 1.2 1.0 0.8

110.9 111.4 111.6 111.3 111.5 111.2 111.2 111.4 111.5 110.6 110.2 110.1

0.9 0.9 1.1 1.3 1.7 1.7 1.4 1.0 0.5 0.5 0.2 0.0

106.6 106.7 107.0 107.3 107.5 107.4 107.7 107.9 107.8 107.8 107.7 107.8

1.3 1.1 1.5 1.6 1.6 1.6 1.7 1.7 1.7 1.7 1.6 1.6

107.7 108.0 108.3 108.5 108.8 108.9 109.1 109.2 109.1 109.1 109.1 109.3

1.7 1.7 2.1 2.3 2.2 2.1 2.2 2.4 1.9 1.8 1.6 1.6

105.6 105.8 105.7 105.6 105.5 105.6 105.7 105.6 105.2 104.5 104.1 103.1

-0.3 -0.9 -0.5 -0.3 0.0 0.1 0.2 -0.2 -0.5 -0.8 -0.9 -2.1

105.7 105.9 105.7 105.4 105.3 105.4 105.5 105.1 104.7 103.6 103.1 101.9

-1.0 -1.7 -1.3 -1.1 -0.7 -0.6 -0.4 -1.1 -1.3 -1.8 -2.0 -3.6

2015 1 2 3 4 5

109.4 109.4 109.4 109.5 109.8

0.8 0.5 0.4 0.4 0.5

110.9 110.6 110.3 110.1 110.6

-0.1 -0.7 -1.2 -1.1 -0.8

108.2 108.4 108.7 109.0 109.2

1.5 1.5 1.6 1.6 1.6

110.3 110.4 110.6 110.7 111.1

2.4 2.3 2.1 2.0 2.1

101.9 101.9 101.8 101.8 101.9

-3.6 -3.6 -3.7 -3.6 -3.5

99.7 99.7 99.5 99.3 99.4

-5.8 -5.8 -5.9 -5.8 -5.6

Source: The Bank of Korea

65

ECONOMIC BULLETIN • july 2015

12. Employment Period

Economically active persons (thousand)

All industry

y-o-y change (%)

Employed persons (thousand) Manufacturing SOC & services

y-o-y change (%)

y-o-y change (%)

y-o-y change (%)

Unemployment rate (%)

2012 2013 2014

25,501 25,873 26,536

1.6 1.5 2.6

24,681 25,066 25,599

1.8 1.6 2.1

4,105 4,184 4,330

0.3 1.9 3.5

19,033 19,347 19,805

2.4 1.6 2.4

3.2 3.1 3.5

2012 1 2 3 4 5 6 7 8 9 10 11 12

24,585 24,825 25,210 25,653 25,939 25,939 25,901 25,623 25,755 25,787 25,652 25,139

2.0 1.6 1.2 1.6 1.8 1.4 1.7 1.4 2.7 1.5 1.3 1.0

23,732 23,783 24,265 24,758 25,133 25,117 25,106 24,859 25,003 25,069 24,941 24,402

2.3 1.9 1.8 1.9 1.9 1.5 1.9 1.5 2.8 1.6 1.4 1.1

4,034 4,060 4,018 4,027 4,071 4,084 4,114 4,111 4,153 4,188 4,218 4,183

-2.8 -2.1 -2.5 -2.0 -1.6 -1.2 0.8 2.0 3.5 3.6 4.0 2.8

18,631 18,599 18,870 19,103 19,292 19,248 19,265 19,040 19,125 19,128 19,088 19,010

3.5 3.2 3.4 3.1 3.0 2.3 2.2 1.6 2.8 1.4 0.9 0.9

3.5 4.2 3.7 3.5 3.1 3.2 3.1 3.0 2.9 2.8 2.8 2.9

2013 1 2 3 4 5 6 7 8 9 10 11 12

24,901 24,973 25,397 25,928 26,195 26,291 26,301 26,074 26,186 26,268 26,230 25,736

1.3 0.6 0.7 1.1 1.0 1.4 1.5 1.7 1.7 1.9 2.3 2.4

24,054 23,984 24,514 25,103 25,398 25,478 25,473 25,291 25,466 25,545 25,530 24,962

1.4 0.8 1.0 1.4 1.1 1.4 1.5 1.7 1.9 1.9 2.4 2.3

4,189 4,139 4,141 4,192 4,175 4,180 4,167 4,116 4,174 4,218 4,253 4,264

3.9 1.9 3.1 4.1 2.6 2.3 1.3 0.1 0.5 0.7 0.8 2.0

18,810 18,736 18,989 19,303 19,492 19,531 19,577 19,438 19,540 19,558 19,670 19,514

1.0 0.7 0.6 1.0 1.0 1.5 1.6 2.1 2.2 2.2 3.0 2.7

3.4 4.0 3.5 3.2 3.0 3.1 3.1 3.0 2.7 2.8 2.7 3.0

2014 1 2 3 4 5 6 7 8 9 10 11 12

25,650 25,997 26,187 26,714 26,762 26,825 26,891 26,775 26,766 26,809 26,786 26,270

3.0 4.1 3.1 3.0 2.2 2.0 2.2 2.7 2.2 2.1 2.1 2.1

24,759 24,819 25,163 25,684 25,811 25,875 25,979 25,885 25,917 25,951 25,968 25,384

2.9 3.5 2.6 2.3 1.6 1.6 2.0 2.3 1.8 1.6 1.7 1.7

4,280 4,274 4,284 4,288 4,324 4,345 4,358 4,335 4,347 4,361 4,355 4,406

2.2 3.3 3.5 2.3 3.6 3.9 4.6 5.3 4.1 3.4 2.4 3.3

19,376 19,407 19,538 19,819 19,815 19,841 20,003 19,940 19,949 19,973 20,098 19,896

3.0 3.6 2.9 2.7 1.7 1.6 2.2 2.6 2.1 2.1 2.2 2.0

3.5 4.5 3.9 3.9 3.6 3.5 3.4 3.3 3.2 3.2 3.1 3.4

2015 1 2 3 4 5 6

26,094 26,398 26,577 26,954 27,211 27,255

1.7 1.5 1.5 0.9 1.7 1.6

25,106 25,195 25,501 25,900 26,189 26,205

1.4 1.5 1.3 0.8 1.5 1.3

4,421 4,433 4,400 4,455 4,464 4,478

3.3 3.7 2.7 3.9 3.2 3.1

19,693 19,716 19,832 20,004 20,179 20,161

1.6 1.6 1.5 0.9 1.8 1.6

3.8 4.6 4.0 3.9 3.8 3.9

Source: Statistics Korea

66

Statistical Appendices

13. Financial indicators (period average)

Period

Yields(%) Corporate bonds Treasury bonds (3 years, AA-) (3 years)

Treasury bonds (5 years)

Stock KOSPI(endperiod)

Call rate (1 day)

CDs (91 days)

2011 1 2 3 4 5 6 7 8 9 10 11 12

2.7 2.8 2.9 3.0 3.0 3.2 3.3 3.3 3.3 3.2 3.3 3.3

2.9 3.1 3.4 3.4 3.5 3.5 3.6 3.6 3.6 3.6 3.6 3.6

4.5 4.7 4.5 4.5 4.4 4.4 4.5 4.2 4.2 4.3 4.2 4.2

3.7 3.9 3.7 3.7 3.7 3.7 3.8 3.6 3.5 3.5 3.4 3.4

4.3 4.4 4.1 4.1 4.0 3.9 4.0 3.7 3.6 3.6 3.5 3.5

2,069.73 1,939.30 2,106.70 2,192.36 2,142.47 2,100.69 2,133.21 1,880.11 1,769.65 1,909.03 1,847.51 1,825.74

2012 1 2 3 4 5 6 7 8 9 10 11 12

3.3 3.3 3.3 3.3 3.3 3.3 3.1 3.0 3.0 2.8 2.8 2.8

3.6 3.5 3.5 3.5 3.5 3.5 3.3 3.2 3.1 2.9 2.9 2.9

4.2 4.3 4.4 4.3 4.0 3.9 3.6 3.4 3.3 3.3 3.3 3.3

3.4 3.4 3.6 3.5 3.4 3.3 3.0 2.8 2.8 2.8 2.8 2.9

3.5 3.6 3.7 3.6 3.5 3.4 3.1 2.9 2.9 2.9 2.9 3.0

1,955.79 2,030.25 2,014.04 1,981.99 1,843.47 1,854.01 1,881.99 1,905.12 1,996.21 1,912.06 1,932.90 1,997.05

2013 1 2 3 4 5 6 7 8 9 10 11 12

2.8 2.8 2.7 2.8 2.6 2.5 2.5 2.5 2.5 2.5 2.5 2.5

2.9 2.8 2.8 2.8 2.7 2.7 2.7 2.7 2.7 2.7 2.7 2.7

3.2 3.1 3.0 2.9 3.0 3.2 3.4 3.3 3.3 3.3 3.4 3.4

2.8 2.7 2.6 2.6 2.6 2.9 2.9 2.9 2.9 2.8 2.9 2.9

2.9 2.8 2.7 2.6 2.7 3.1 3.2 3.2 3.2 3.1 3.2 3.3

1,961.94 2,026.49 2,004.89 1,963.95 2,001.05 1,863.32 1,914.03 1,926.36 1,996.96 2,030.09 2,044.87 2,011.34

2014 1 2 3 4 5 6 7 8 9 10 11 12

2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.3 2.2 2.1 2.0 2.0

2.7 2.7 2.7 2.7 2.7 2.7 2.7 2.5 2.4 2.2 2.1 2.1

3.3 3.3 3.3 3.3 3.3 3.2 3.0 3.0 2.8 2.6 2.5 2.5

2.9 2.9 2.9 2.9 2.8 2.7 2.6 2.5 2.4 2.2 2.1 2.1

3.3 3.2 3.2 3.2 3.1 3.0 2.8 2.8 2.6 2.4 2.3 2.3

1,941.15 1,979.99 1,985.61 1,961.79 1,994.96 2,002.21 2,076.12 2,068.54 2,020.09 1,964.43 1,980.78 1,915.59

2015 1 2 3 4 5 6

2.0 2.0 1.8 1.7 1.7 1.6

2.1 2.1 2.0 1.8 1.8 1.7

2.4 2.3 2.1 2.0 2.1 2.0

2.0 2.0 1.9 1.7 1.9 1.8

2.2 2.1 2.0 1.9 2.1 2.0

1,949.26 1,985.80 2,041.03 2,127.17 2,114.80 2,074.20

Source: The Bank of Korea

67

ECONOMIC BULLETIN • july 2015

14. Monetary indicators (billion won)

Period 2012 2013 2014

Reserve money y-o-y change (%)

M1

M2

y-o-y change (%)

Lf

y-o-y change (%)

y-o-y change (%)

82,131.1 91,379.4 103,331.5

9.2 11.3 13.1

441,963.6 484,062.9 536,733.4

3.8 9.5 10.9

1,798,625.7 1,885,781.3 2,009,576.3

5.2 4.8 6.6

2,379,518.7 2,543,299.4 2,721,747.4

7.8 6.9 7.0

2012 1 2 3 4 5 6 7 8 9 10 11 12

81,635.4 81,655.3 79,068.0 80,641.8 80,547.7 81,804.0 81,555.7 82,369.1 82,958.7 85,078.6 82,956.5 85,302.7

11.0 8.3 8.3 10.2 9.1 9.5 10.1 8.9 6.4 10.6 8.3 9.6

439,352.9 437,193.9 440,075.4 437,445.3 438,795.3 441,611.0 441,760.6 439,573.2 440,034.3 444,477.8 445,463.9 457,778.9

2.3 1.1 2.1 2.8 3.5 4.7 5.4 4.0 3.5 5.5 5.3 5.8

1,757,058.7 1,762,988.4 1,773,172.9 1,777,114.7 1,784,220.5 1,796,981.5 1,807,289.2 1,817,134.9 1,819,290.1 1,822,420.9 1,830,280.3 1,835,556.7

4.8 5.3 5.7 5.5 5.5 5.9 6.0 5.7 5.2 4.6 4.4 4.5

2,292,213.5 2,302,065.8 2,341,626.9 2,349,723.2 2,357,701.0 2,377,071.3 2,393,737.7 2,405,239.9 2,415,263.5 2,424,000.4 2,440,062.8 2,455,962.9

6.5 7.2 8.8 8.6 8.4 8.5 8.4 7.8 7.6 7.1 7.1 7.3

2013 1 2 3 4 5 6 7 8 9 10 11 12

85,839.3 88,855.7 89,523.5 87,729.0 89,654.8 91,207.6 90,643.7 93,729.6 95,130.6 93,640.4 93,609.9 96,988.5

5.1 8.8 13.2 8.8 11.3 11.5 11.1 13.8 14.7 10.1 12.8 13.7

464,914.5 472,239.6 472,430.1 475,330.0 475,526.7 486,587.5 488,982.7 481,416.9 490,518.7 491,947.9 499,242.7 509,617.9

5.8 8.0 7.4 8.7 8.4 10.2 10.7 9.5 11.5 10.7 12.1 11.3

1,841,128.1 1,857,135.0 1,862,405.5 1,867,726.3 1,870,289.7 1,884,193.2 1,890,728.6 1,888,658.4 1,903,187.1 1,908,557.6 1,923,339.2 1,932,026.4

4.8 5.3 5.0 5.1 4.8 4.9 4.6 3.9 4.6 4.7 5.1 5.3

2,469,789.3 2,488,539.0 2,499,718.1 2,512,459.7 2,518,239.1 2,533,750.8 2,549,443.5 2,557,336.3 2,577,546.7 2,587,071.4 2,605,873.9 2,619,029.5

7.7 8.1 6.8 6.9 6.8 6.6 6.5 6.3 6.7 6.7 6.8 6.6

2014 1 2 3 4 5 6 7 8 9 10 11 12

98,541.6 100,547.9 100,624.0 98,898.5 101,791.4 101,412.3 101,164.2 107,682.4 105,354.1 107,117.5 106,667.9 110,175.6

14.8 13.2 12.4 12.7 13.5 11.2 11.6 14.9 10.7 14.4 13.9 13.6

515,742.5 518,475.5 520,299.0 518,809.3 523,069.9 532,041.2 534,028.8 538,640.3 548,550.8 551,416.0 562,006.2 577,721.1

10.9 9.8 10.1 9.1 10.0 9.3 9.2 11.9 11.8 12.1 12.6 13.4

1,937,045.6 1,954,340.7 1,964,954.0 1,970,361.6 1,982,390.9 1,999,376.3 2,013,935.1 2,031,777.2 2,037,600.8 2,051,149.8 2,083,253.5 2,088,729.8

5.2 5.2 5.5 5.5 6.0 6.1 6.5 7.6 7.1 7.5 8.3 8.1

2,635,100.1 2,647,674.0 2,659,370.7 2,669,341.4 2,684,643.9 2,703,088.1 2,725,737.6 2,743,972.5 2,759,390.8 2,776,971.6 2,817,698.0 2,837,910.9

6.7 6.4 6.4 6.2 6.6 6.7 6.9 7.3 7.1 7.3 8.1 8.2

2015 1 2 3 4 5

113,304.2 116,502.4 115,974.9 115,132.7 117,726.3

15.0 15.9 15.3 16.4 15.7

579,964.2 592,737.4 600,719.9 610,803.3 621,985.5

12.5 14.3 15.5 17.7 18.9

2,092,223.5 2,109,843.2 2,127,887.8 2,148,114.7 2,166,741.1

8.0 8.0 8.3 9.0 9.3

2,857,610.1 2,876,619.9 2,907,976.4 2,936,746.7 2,960,998.1

8.4 8.6 9.3 10.0 10.3

Source: The Bank of Korea

68

Statistical Appendices

15. Exchange rates (end-period)

Period

100/ \

US $/ \

Euro/ \

Won

y-o-y change (%)

Won

y-o-y change (%)

Won

y-o-y change (%)

2012 2013 2014

1,071.1 1,055.3 1,099.2

-7.1 -1.5 4.2

1,247.5 1,004.7 920.1

-16.0 -19.5 -8.4

1,416.3 1,456.3 1,336.5

-5.2 2.8 -8.2

2012 1 2 3 4 5 6 7 8 9 10 11 12

1,125.0 1,126.5 1,137.8 1,134.2 1,177.8 1,153.8 1,136.2 1,134.6 1,118.6 1,094.1 1,084.7 1,071.1

1.0 -0.1 2.8 5.8 9.0 7.0 7.9 5.9 -5.2 -0.9 -5.7 -7.1

1,473.1 1,399.2 1,380.7 1,412.0 1,489.1 1,453.8 1,453.6 1,444.0 1,441.1 1,374.5 1,320.6 1,247.5

8.6 1.3 3.7 7.5 11.5 8.8 7.4 3.4 -6.2 -5.7 -10.5 -16.0

1,478.2 1,516.3 1,513.4 1,501.7 1,456.6 1,435.0 1,393.1 1,419.6 1,444.3 1,418.3 1,407.3 1,416.3

-2.4 -2.1 -3.2 -5.6 -6.0 -8.0 -7.6 -8.3 -9.8 -9.2 -8.2 -5.2

2013 1 2 3 4 5 6 7 8 9 10 11 12

1,082.7 1,085.4 1,112.1 1,108.1 1,128.3 1,149.7 1,113.6 1,110.9 1,075.6 1,061.4 1,062.1 1,055.3

-3.8 -3.6 -2.3 -2.3 -4.2 -0.4 -2.0 -2.1 -3.8 -3.0 -2.1 -1.5

1,188.5 1,176.2 1,180.1 1,132.0 1,116.6 1,167.2 1,135.4 1,129.2 1,098.7 1,077.5 1,038.2 1,004.7

-19.3 -15.9 -14.5 -19.8 -25.0 -19.7 -21.9 -21.8 -23.8 -21.6 -21.4 -19.5

1,469.3 1,425.8 1,425.2 1,451.3 1,471.4 1,498.2 1,476.7 1,470.6 1,451.3 1,456.6 1,444.8 1,456.3

-0.6 -6.0 -5.8 -3.4 1.0 4.4 6.0 3.6 0.5 2.7 2.7 2.8

2014 1 2 3 4 5 6 7 8 9 10 11 12

1,079.2 1,067.7 1,068.8 1,031.7 1,021.6 1,014.4 1,024.3 1,013.6 1,050.6 1,054.0 1,101.1 1,099.2

-0.3 -1.6 -3.9 -6.9 -9.5 -11.8 -8.0 -8.8 -2.3 -0.7 3.7 4.2

1,043.7 1,044.8 1,038.7 1,005.3 1,004.2 1,000.0 995.7 977.6 960.2 964.1 933.9 920.1

-12.2 -11.2 -12.0 -11.2 -10.1 -14.3 -12.3 -13.4 -12.6 -10.5 -10.0 -8.4

1,473.6 1,463.6 1,469.4 1,425.0 1,389.6 1,384.2 1,371.8 1,336.2 1,333.3 1,328.8 1,372.2 1,336.5

0.3 2.7 3.1 -1.8 -5.6 -7.6 -7.1 -9.1 -8.1 -8.8 -5.0 -8.2

2015 1 2 3 4 5 6

1,090.8 1,099.2 1,105.0 1,068.1 1,108.0 1,124.1

1.1 3.0 3.4 3.5 8.5 10.8

921.3 920.7 920.3 897.2 894.6 917.2

-11.7 -11.9 -11.4 -10.8 -10.9 -8.3

1,235.7 1,230.7 1,196.8 1,187.0 1,215.2 1,260.5

-16.1 -15.9 -18.6 -16.7 -12.6 -8.9

Source: The Bank of Korea

Geumseong Sanseong Geumseong Sanseong is a mountain fortress located in Damyang, South Jeolla Province. Built during the Three Kingdoms Period, the fortress has played important roles in a number of historic events, such as the Japanese invasions in 1592-98 and the Donghak Peasant Revolution in 1894.

Useful websites Ministry of Strategy and Finance http://english.mosf.go.kr Ministry of Trade, Industry and Energy http://www.motie.go.kr/language/eng Financial Services Commission http://www.fsc.go.kr/eng Financial Supervisory Service http://english.fss.or.kr Fair Trade Commission http://eng.ftc.go.kr Ministry of Employment and Labor http://www.moel.go.kr/english The Bank of Korea http://www.bok.or.kr/eng Statistics Korea http://kostat.go.kr/portal/english

ISSN 2287-7266

ECONOMIC BULLETIN (Republic of Korea)

Republic of Korea

Vol.37 No.7 July 2015

conomic u l l e t i n

Vol.37 No.7 July 2015

The Green Book: Current Economic Trends Policy Issues

Investment Promotion Measures: Tourism, Ventures and Construction Supplementary Budget of 12 Trillion Won Proposed

Economic News Briefing

Foreign Investment Promotion Plans Plan to Boost Competitiveness of Korea’s Exchange Market Government to Improve Household Debt Management Efficiency Korea Allotted 3.81% Share in AIIB

Statistical Appendices

ECONOMIC BULLETIN

(Republic of Korea)

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July 2015

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