South Korea’s top central banker called for local companies Wednesday to expand investment and create more jobs in a bid to help the economy recover from a prolonged slowdown.
Bank of Korea Gov. Kim Choong-soo said in a meeting with six heads of large firms that companies are facing tough business conditions amid the global downturn, but they should play a key role in helping the Korean economy pull out of the longstanding slowdown.
“It may be difficult for companies to make investments under such circumstances, but there are no other alternatives,” the BOK head said.
Local firms, whose third-quarter earnings took a hit during the economic slowdown, are wary of increasing capital spending as economic uncertainty lingers. The BOK’s forecast facility investment will grow 1.5 percent on-year in 2012, slowing from a 3.7 percent expansion last year.
The central bank said earlier that the Korean economy is likely to grow 2.4 percent this year and 3.2 percent next year. The third-quarter growth reached 0.2 percent on-quarter, but it is widely expected to pick up in the fourth quarter.
According to the BOK, the participants said that local firms need to strengthen efforts to shield themselves from currency volatility risks.
The local currency has risen more than 6 percent so far this year, making prices of export goods more expensive in overseas markets. (Yonhap News)
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