The Korea Herald


S. Korea's industrial output grows 9.1 pct in Feb.

By 양승진

Published : March 31, 2011 - 10:12

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   South Korea's industrial output grew for the 20th straight month in February, indicating the economy is continuing to expand, a government report showed Thursday.

   According to the report by Statistics Korea, production in the mining and manufacturing industries rose 9.1 percent last month from the same month a year earlier. Output has increased since July 2009.

   Output was fueled mainly by semiconductors, components and machinery equipment, the report explained. From a month earlier, however, production fell 2.3 percent due to sluggish output of automobiles and clothes and service-sector output also contracted 3.4 percent from January.

   Although the on-year industrial output continued to expand, other indicators painted a less rosy picture of the economy.

   Local manufacturing plants operated at 82.5 percent, down 2.2 percentage points from a month earlier, when the operating rate reached the highest point since the agency started to compile related data, the report showed.

   Retail sales fell 6.1 percent from a month earlier and they also inched down 0.8 percent from the same month a year earlier.

Facility investment declined 8.4 percent from a month earlier, though it grew 1.6 percent from a year earlier, the report showed.

   Indicators on current and future economic outlooks also worsened.

   The key index measuring current economic conditions dropped 0.2 percentage point from a month earlier, marking the first decline in four months. The leading economic composite index, a gauge of economic performance eight to 15 months ahead of time, also fell 0.6 percentage points, the first decline in two months, according to the report.

   The data comes as economic uncertainties are mounting at home and abroad amid concerns that rising oil and commodity prices affected by drawn-out unrest in the Middle East could weigh on the nation's growth.

   The government, however, expressed cautious optimism about economic conditions down the road.

   "Indicators for domestic demand such as service-sector output and retail sales dropped due to one-off and seasonal factors but the industrial output as a whole remains on a recovery track," the Ministry of Strategy and Finance said in a press release.

   "We expect that the economy will regain its stable recovery momentum after March, considering favorable conditions for domestic demand and exports," it added.

   But the ministry cited high oil prices, the fallout from the quake in Japan and the debt problem in Europe as possible downside risks on the economy, saying that the government will continue to closely monitor external market conditions going forward. (Yonhap News)