Soaring Won Threatens Small and Middle-Sized Companies
Due to the rising value of the won, exports of small and middle-sized companies have been shrinking, threatening the stability of the export market.
The Korean Institute of Industry and Technology Information (KIET) said, through a report entitled ‘Causes and Factors of Continuous Export Increase,’ exports of local small and middle-sized shared 42% in 2002, but was reduced to 32% between January and May this year due to the increasing value of the won.
KIET stated, “Since the export of small and middle-sized companies mainly concentrates on specialized products, we can see that it is relatively stable compared to exports of Korean conglomerates.” It added, “But it can also be seen that decreasing exports of small and middle-sized companies can trigger instability in Korean exports if the global economy slows down."
The report analyzes that not only increasing won value, but also decreasing prices of IT products, influence exports of small and middle-sized companies. Researcher Shin Hyun-soo said, “Even if local companies concentrate on export and have kept making profits through improving productivity and cost reduction, if there is a continuous increase in the value of the won, it is clear that exports will be decline.”
However, Shin analyzed that there was a 13.9% increase in national exports in the first half of the year, notwithstanding aggravation of payability. Consecutive growth of the global economy, oil products and increasing exports of LCD panel products, imports and consumption growth of developing countries in the Middle East, South America, East Europe, and India played a key role.
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 / 입력시간: 2006. 07.22. 09:38
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