Exporters expect yen to stay weakMost Korean exporters expect the Japanese yen to remain weak for the rest of the year, which could hurt overseas competitiveness of locally made goods, a poll showed yesterday.
The survey on 500 companies nationwide by the Korea Chamber of Commerce and Industry showed 75.5 percent of the respondents forecasting the weak yen to last at least till the end of 2012.
Of the companies checked, 56.8 percent said the Japanese currency will remain weak vis-a-vis the U.S. dollar this year, with 18.7 predicting this trend may continue into 2013.
The Japanese currency, which traded at 75.8 yen to the greenback in late October, fell to around 83 yen this week.
The depreciation is the result of Japan’s first ever annual trade deficit in 2011. Tokyo also said that its trade balance was in the red by $18.5 billion in the first month of this year.
The KCCI said 62.1 percent of local exporters were bracing for a decline in price competitiveness with 47.6 percent expressing concerns that stiffer competition will hurt profit margins.
Another 21.0 percent said the weak yen could cause a drop in exports since Japanese products will cost less in overseas markets.
“Many companies also said the weak yen is causing foreign currency transaction losses,” the chamber of commerce said.
By industry, 97.6 percent of steel and metal exporters expected some fallout, with numbers for shipbuilding, and semiconductors and displays reaching 86.4 percent and 76.9 percent, respectively.
The country’s largest economic organization with over 135,000 members said 54.7 percent of the companies polled claimed they had no clear strategy to cope with the weak yen.
Companies, meanwhile, called on the government to help with financing and risk management, and to refrain from raising interest rates.
More in Economy
Hangeoleum model compromise is achieved for minbak
On the campaign trail
Online courses get failing grades from tech students
Help after the rains