Fallout with Japan can do more harm to the South Korean economy than protracted trade tensions between the U.S. and China, a survey on economists showed.
In the Maeil Business Newspaper poll on 265 economists under Korean Academic Society of Business Administration ahead of the annual conference held in Seoul on Monday, trade spat between Korea and Japan was cited the biggest danger for Korean enterprises (39.8 percent), beating deepening trade war between the U.S. and China (36.4 percent.)
Slowing global economy due to U.S-China tensions was the third concern (11.2 percent.)
Economists disapproved of the diplomatic skills and response from Moon Jae-in administration in the face of national challenges.
Nearly half, or 46.5 percent, said the Moon administration poorly handled the situation by failing to study the consequences of the Supreme Court’s ruling in favor of the victims of wartime forced labor in a diplomatic manner, while 11.9 percent said conflict worsened because politicians fanned anti-Japanese sentiment.
Six out of 10 found fault with Korean policymakers for worsening the situation and relations between the two countries.
With regards to domestic risk factors on Korean businesses for the remainder of the year, most pointed to an increased burden on business operations arising from a minimum wage hike and working hour reduction (40.1 percent). Other major risk factors included worse business performance in the country’s mainstay exporters in the semiconductor and automotive sector (23.4 percent) and an overall decline in domestic consumption and investment (23.0 percent).
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