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THE INVESTOR] Korea’s high economic dependence on China is a double-edged sword, a report said on Friday.
In a report titled “China’s choice,” the McKinsey Global Institute ranked Korea fourth in the world in terms of economic dependence on China.
According to the report, Korea is fourth in the world in terms of the proportion of gross domestic product raised from exports to China. Oman showed the highest dependence followed by Angola and Malaysia.
Korea’s economy is highly trade reliant. About 50 percent of the country’s GDP is generated from exports, and China accounts for about a quarter of Korea’s exports.
The number of Chinese tourists here have soared in recent years, accounting for about 40 percent of all visitors to the country.
With China presenting such a large economic effect, experts say that Korea will feel the most acute impact from any changes in the Chinese economy.
“A slowdown in (the) Chinese economy will reduce tourists and trade, and have a big impact on Korea,” an MGI researcher was quoted as saying by the local media.
“China is clearly a big risk factor, but if China takes a different path, there will be many more opportunities for Korea.”
By Choi He-suk (cheesuk@heraldcorp.com)