Nomura optimistic on Korea’s position

Home > Business > Economy

print dictionary print

Nomura optimistic on Korea’s position

Nomura projected that Korea is one of only four emerging countries that will likely maintain momentum in its current-account balance, according to a report released by the Korea Center for International Finance yesterday.

Based on the KCIF report compiling views on the Korean economy, Nomura has forecast that only four of 26 emerging countries - including Korea - will retain growth momentum in their current accounts based on progress over the past three years. The other three nations cited by the Japanese investment banking group were Vietnam, Hungary and the Philippines.

According to the Bank of Korea, in July, Korea posted a current-account surplus for the 18th straight month.

The report also stated that Nomura listed Korea as one of the eight emerging countries that are less sensitive to external shocks, based on strong economic fundamentals such as the ratio of foreign currency-denominated debt to gross domestic product and the ratio of short-term debt to foreign reserves.

For example, the ratio of Korea’s foreign currency-denominated debt to GDP is 34 percent, which ranks 16th-lowest after China (12.1 percent), Russia (13 percent), Egypt (13.3 percent)and India (16 percent). Also, the ratio of short-term debt to foreign reserves is 37 percent, 12th-lowest among 26 emerging countries after Brazil (11 percent), the Philippines (13 percent), Peru (14 percent) and China (15 percent).

Despite an optimistic outlook, the report also noted that Germany-based Deutsche Bank pointed out some risk elements that could hamper the Korean economy from growing further.

“Deutsche Bank put focus on the fact that if production costs like wage and energy prices surge, then it could place a long-term burden on developing the country’s manufacturing sector,” the report said.

BY lee eun-joo []

Log in to Twitter or Facebook account to connect
with the Korea JoongAng Daily
help-image Social comment?
lock icon

To write comments, please log in to one of the accounts.

Standards Board Policy (0/250자)

What’s Popular Now