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| ▲ The Korea Federation of SMEs building in Seoul (Yonhap) |
SMEs-biz outlook
SME biz sentiment stays below par for H2
SEOUL, July 11 (Yonhap) -- South Korean smaller firms' business outlook remains below par for the second half of the year amid a sluggish economy, a poll showed Tuesday.
The survey of 500 small and midsized enterprises (SMEs) showed the country's small business health index (SBHI) amounting to 88.7 for the July-December period.
The figure was up 6.4 points from six months earlier, but it still fell below the benchmark.
A reading below 100 indicates pessimists outnumber optimists, and vice versa. The survey was taken by the Korea Federation of SMEs from July 3-7.
South Korea's SME sentiment has been in the doldrums due to slumping exports, anemic domestic demand, rising raw material costs and other negatives.
In particular, Asia's fourth-largest economy remains gripped by sinking exports, its key growth engine.
South Korea's outbound shipments fell 6 percent on-year to US$54.24 billion in June due mainly to slumping overseas chip demand, marking the ninth consecutive month of decline. Exports dipped 14.8 percent on-year in the first 10 days of July.
According to the findings, 46.2 percent of the respondents cited high raw material costs as the biggest hurdle to their second-half management, followed by sluggish domestic demand (43.4 percent) and rising interest rates (28.6 percent).
Nearly 51 percent of those surveyed predicted domestic demand to pick up in 2025 or thereafter, with 44.2 percent and 5 percent forecasting the recovery to begin next year and this year, respectively.
The federation called on the government to take steps to help cut corporate costs and to reanimate SME investment through sustained deregulation.
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