By Kim Young Shin
The Ministry of Strategy and Finance has forecasted that, “The recovery of the Korean economy is likely to continue, considering the improving world economy and the high-performance of exports,” on May 14.
The finance ministry argued against any prospect that the Korean economy would see a decline based on the Composite Leading Indicators Index (CLI) by the Organisation for Economic Co-operation and Development (OECD), saying that, “The economy should be judged comprehensively taking various economic indicators into account, not just by the Composite Leading Indicators Index.”
According to the ministry, Korea’s CLI stayed below 100 for two consecutive months in January and February 2018, at 99.8. This is the first time in 40 months, since September 2014, for Korea’s CLI to drop below 100.
The ministry said that the OECD’s CLI does not necessarily match the actual status of the country’s economy. It said that the IMF’s economic outlook on France increased from 1.8 percent last year to 2.1 percent this year, and Australia, from 2.3 percent to 3.0 percent, even though their OECD CLI dropped from 100.4 to 100.2 and from 100.1 to 99.6, respectively.
The ministry also added that the leading indicators index assessed by Statistics Korea, although with monthly fluctuations, continued to stay above 100 for 19 consecutive months since September 2016.
“Major economies, such as the U.S. and Japan, also calculate their own leading indicators index that covers different economic circumstances in their countries,” said an official from the ministry.