President Lee Myung-bak said the economy would shrink, but that the second half of next year would surface with growth on an annual basis, reports the Associated Press. How or why is still unknown, as the President kept quiet after making his statements.
Lee states that the growth for the country would remain at 7%, although next year would prove to be a difficult period. The International Monetary Fund estimated that the fourth-largest Asian economy would settle at 4% annual growth.
Ssaangyong Motor, the weak Korean automaker, is receiving aid from the Chinese counterpart, SAIC Motor Corp. By doing so, the carmaker will help the economy at large heal itself and stave off further collapse. The carmaker needs financial assistance and SAIC owns 51% of the company, reports Choe Sang-Hun for The New York Times.
Banks in the construction and shipping sectors are going to be screened in January for further financial assistance. The banks are the last resort for financial assistance, after the other companies and capital flow has been tapped into.
Meanwhile, Citibank Korea is getting assistance from Citigroup, in the form of $800 million. The move is an attempt to raise the bank’s capital base on a recommendation by South Korea’s financial regulator, reports CNN Money.
- iShares MSCI South Korea (EWY): down 56.5% year-to-date
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