Industrial Output Sinks 10.6% in March

By Lee Hyo-sik Staff Reporter Industrial output in March fell by double digits for the fifth-straight month, hit hard by plunging sales at home and abroad amid the continuing global economic downturn. Simultaneously, it signaled that economic contraction here is moderating, raising hopes that the worst may be over for the world's 13th-largest economy. According to the National Statistical Office (NSO) Thursday, industrial output contracted 10.6 percent in March from the same month the previous year, slightly higher than the 10-percent fall in February. It was the fifth consecutive month of double-digit decline since November last year. In January, production fell by 25.5 percent, the largest year-on-year decrease since the statistical office began compiling related data in January 1970. But after adjusting for seasonal factors, output rose 4.8 percent from February, rising for the third-straight month. Additionally, key indexes measuring current economic conditions and the future outlook rose together for the first time in 14 months. ``It's too early to say that the Korean economy has hit the bottom. But things will not likely worsen much from here. It doesn't mean that the economy will significantly improve, either,'' NSO director Yun Myung-joon said. Yun then said exports will not improve any time soon because the United States and Korea's other major trading partners have shown no signs of an improvement, adding private consumption and corporate investment will not pick up either. ``I think production, investment and consumption will likely maintain their current pace for the time being.'' March output data, the latest in a series of economic indices, add to the optimism that the worst may be behind Asia' fourth-largest economy and that it's building upward momentum. On Wednesday, the Bank of Korea (BOK) announced that the nation's current account surplus reached $6.65 billion in March, the largest since the central bank began compiling the data. The record high surplus was helped by exports declining at a slower pace than imports. Additionally, the bank reported last week that gross domestic product grew 0.1 percent in the first quarter of the year from a quarter earlier, signaling that the pace of the economic downturn has eased. During the final quarter of 2008, output plunged 5.1 percent from the previous quarter. The statistical office said the production of semiconductors and automobiles, the nation's two major export items, increased 10.8 percent and 4.5 percent in March from a month earlier, respectively. Inventories fell 0.9 percent from February, with factories operating at an average capacity of 69.3 percent, up from 66.9 percent the previous month. Conversely, the services sector output fell 0.7 percent month-on-month, while retail sales dropped 1.9 percent as consumers continued to tighten their purse strings amid the tight job market. leehs@koreatimes.co.kr