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S.Korea's exports suffer worst slump in 11 years as pandemic shatters world trade

News Service
09:10 - 1/05/2020 Cuma
Update: 09:14 - 1/05/2020 Cuma
REUTERS
File photo
File photo

'DREADFUL YEAR'

More than 3.21 million people have been infected across the world, according to a Reuters tally, with nationwide infections in South Korea surpassing 10,700.

The virus pushed the South Korea's economy into its biggest contraction since 2008 in the first quarter, while the business outlook slumped to the worst on record.

Many expect the economy to shrink this year, with the International Monetary Fund (IMF) now seeing a 1.2% contraction.

Hobbled by coronavirus, its two biggest trading partners, the United States and China saw their economies contract sharply in the first quarter, suggesting a painfully slow path to recovery for global trade.

Months of pandemic lockdowns across the United States and Europe brought factories to a screeching halt, causing unprecedented disruptions for many Korean businesses including the nation's global-trotting tech titans.

Samsung Electronics on Wednesday joined other tech giants such as SK Hynix in declining to provide annual forecasts because of uncertainty about the pandemic but said it expected profit to decline in the second quarter due to slumping sales of smartphones and TVs.

In a recent note to clients, Capital Economics forecast global trade volumes will tumble 20% in 2020, saying it will be "a dreadful year" as major economies struggle to recover from the pandemic.

South Korea has pledged stimulus totalling about 240 trillion won ($196.73 billion) to tackle the economic slowdown, while markets are betting the Bank of Korea could ease again in coming months.

The BOK cut rates by 50 basis points March - the largest policy easing since the global financial crisis. The bank next reviews its policy on May 28. ($1 = 1,219.9700 won)

#coronavirus
#South Korea
#trade
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