The government plans to bolster domestic consumption and fuel the country’s overall economic buoyancy to cope with mounting global market uncertainties, the finance ministry said Tuesday.

In its monthly “green book” report, the Ministry of Strategy and Finance said that economic data in such areas as industrial production, retails, business investment and construction all backtracked in March.

Industrial production, a key barometer of economic health, contracted 3.1 percent in the cited month from February, with retail sales falling 2.7 percent in the same period. Facility investments and money poured into the construction sector fell by 7 percent and 1.8 percent, respectively, in March compared to the month before.

It also said persistent eurozone woes fueled by the downgrading of Spain’s sovereign rating, sluggish economic recovery in the United States and slowdown in growth in China, South Korea’s largest export market, all raised worries.

“Seoul will keep close tabs on both overseas and local developments and take steps to revive business investment and domestic consumption in the future,” the ministry said.

On the positive side, the ministry said exports have been able to move forward despite unfavorable foreign market conditions, which allowed the country to maintain its net trade surplus this year. It added that both consumer and producer prices have fallen in April from a year earlier alleviating earlier inflationary concerns.

Consumer and producer prices gained just 2.5 percent and 2.4 percent, respectively, in the cited month vis-a-vis the previous year.

The ministry also said that improvements in the domestic job market are helping to raise expectations of sustained growth. Such developments, it said, must be maintained to offset negative economic indicators.

The government predicted Asia’s fourth largest economy will grow 3.7 percent in 2012, with growth to be focused mainly in the second half. In the first quarter, the country’s gross domestic product grew a modest 2.8 percent on-year. 

(Yonhap News)