South Korea will maintain its current economic policy stance but will be ready to take preemptive action against any danger factors facing the country‘s economy, the finance minister said Wednesday.
“Though our economy sees continued improvement in employment and other major indicators, it is still difficult to let our guard down in the face of external risk factors such as high oil prices and the eurozone fiscal crisis,” Bahk Jae-wan told a meeting with other policymakers.
“An economic slump comes without sounding alarms and our response to the slump should be swift at all times,” he added.
Bahk’s comments come as the South Korean economy, Asia‘s fourth-largest, shows signs of a slowdown, hit by the lingering
eurozone debt crisis and soaring crude prices.
In the fourth quarter of last year, the economy expanded 0.4 percent from three months earlier, slowing from a 0.8 percent gain for the July-September period. From a year earlier, it grew 3.4 percent, down from a 3.5 percent on-year growth in the previous quarter.
Bahk said boosting domestic demand is no less important than increasing exports for economic growth, saying the government should work hard to develop the service sector, in particular, to attract more spending from home and abroad.
In a related move, the minister urged that more efforts be made to stimulate the country’s education, medical and tourism sectors so as to encourage citizens and foreign tourists to spend more in domestic markets.
