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Majority of S. Korean companies worried about long-term economic slump

More than 80 percent of major South Korean companies are concerned that the ongoing economic slump is not temporary, but a deep-rooted recession, a survey showed Wednesday.

According to a poll of the top 29 conglomerates conducted by the Federation of Korean Industries, 24 companies, or 82.8 percent, replied that South Korea is on the verge of a structural, long-term recession this year, while the rest viewed the slump as temporary.

It also showed that 55.2 percent of the respondents said they are facing a worse business environment now than during the 2008 global financial crisis, with 17.2 percent answering that the market situation is similar to seven years ago.

More than 85 percent of the surveyed firms expect the economy to recover after 2016 at the earliest.

They cited fiercer competition in the overseas market, sluggish domestic demand and dampened profitability as the main obstacles in doing business.

For their 2015 investment outlook, 24.1 percent answered that they will spend less money on investment this year, while 41.1 percent said they have no plan to change their investment plan in 2015.

The firms called for government efforts to revive domestic consumption, ease investment-related regulations and expand corporate tax benefits in order for companies to be able to increase corporate spending, the FKI said. (Yonhap)