Korea sees worsening economic slowdown on exports’ fall: KDI

South Korea has experienced a worsening economic slowdown over dwindling exports and a weaker recovery of domestic demand, a state-run think tank said Tuesday.

The assessment by the Korea Development Institute (KDI) was bleaker than its outlook made a month earlier that the country was showing signs of an economic slowdown as the manufacturing industry lost steam over sluggish exports.

“Exports have fallen more sharply and domestic demand has risen at a slower pace, deepening an economic slowdown,” the KDI said in a monthly economic assessment report.

The country began experiencing an economic downturn from this year in earnest and the situation has taken a turn for the worse, it added.

In January, exports fell 16.6 percent on-year to come to US$46.27 billion, following a 9.5 percent on-year fall the previous month, according to the Ministry of Trade, Industry and Energy.

The fall was mainly attributable to the drop in global demand for semiconductors, steel, petrochemical and other major products.

Shipments to China tumbled 31.4 percent in January, and those to the United States also lost 6.1 percent.

The trade deficit reached an alltime monthly high of $12.69 billion last month, the data showed.

Retail sales, a gauge of private spending, fell 2.5 percent in December, marking a steeper fall compared with 2.1 percent the previous month.

Consumer prices, a key gauge of inflation, rose 5.18 percent in January from a year earlier, compared with 5.04 percent growth in December. Inflation rose by 5 percent or higher for the ninth month in a row.