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South Korea Reportedly Heading Toward Another Crisis

By February 23, 2017 at 12:33 am
Bank Of Korea Governor Lee Ju Yeol Attends Rate Decision Meeting (Photo : SeongJoon Cho/Bloomberg via Getty Images)

South Korea is on the brink of another issue and that has something to do with the country's current economic status. Few people started to ask if the country is falling into another crisis because of the endless controversies and scandals it currently faces.

Some said that South Korea is heading toward another crisis like what happened from 1997-1998. There have been recorded series of mishaps during the past days like the massive recall of Samsung Galaxy Note 7, a collapse of Hanjin Shipping, and the political scandal involving President Park Geun-Hye.

It can be recalled that Korea has been considered as one of the world's top exporting countries. However, the country's global reputation has been extremely undermined as per Korea Times.

Some foreigners believed that Korea's economy is no longer attractive and resilient unlike before. The indicators for their belief and conclusion are the bleak domestic situation and the several economic disasters.

But this situation can be prevented if the policymakers will only do inward focus and myopic view of the situation of the economy.

"Chances are very low that the Korean economy will experience a critical situation like the 1997 currency crisis and the 2008 global financial crisis," Strategy and Finance Minister Yoo Il-ho quipped.

Another thing that might be posing threat to the country's economy is when the Daewoo Shipbuilding and Marine Engineering will not be able to pay its debt which is due in April. Moreover, all of the economic domestic indicators are all pointing in a downward direction.

But the majority of the global investors and some of the credit rating agencies still believe that the economy of Korea is not heading toward an economic crisis. The reason is that there are still a lot of foreign exchange reserves as well as excellent external debt positions as per Financial Tribune.

Even if that is the case, policymakers should know that Korea's reputation has been deteriorating gradually and the situation of the economy might end up worse in the event that there is an external trigger.

However, policymakers should be aware that Korea's reputation is slowly weakening and the situations could suddenly turn for the worse if there is any external trigger.

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