Chips, cars drive Korean revival
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South Korea's strong growth in industrial output indicates the start of an economic recovery across Asia.
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SEOUL, South Korea (Reuters) -- South Korea's industrial output rose a better-than-expected 2.7 percent in December from a month earlier as strong exports of chips and autos offset frail local consumption and investments, new government data shows.
Friday's South Korean figure follows data released Thursday showing Japanese industrial output grew 3.6 percent in the last quarter of 2003, fuelled by higher demand for electronic equipment around the world but especially in China.
It was Japan's highest quarterly increase in 10 years. (See full story)
The upbeat South Korean figures are further evidence that the economy, Asia's fourth-largest, remains on track for a firm turnaround.
Business is booming in silicon chips and cars.
"Soaring exports of chips, mobile sets and autos boosted industrial activities for December, while a deceleration in consumption and investments slowed," the National Statistical Office said in a statement.
South Korean Finance Minister Kim Jin-pyo said Friday he expects to see double-digit monthly export growth throughout this year.
Exports, the sole growth engine in the wake of sluggish consumption, surged 32.5 percent in December from a year earlier to $19.92 billion on a customs-cleared basis, bringing the country's trade surplus to $2.3 billion.
Output of chips soared 44 percent from a year earlier, driving top-line production higher, the statistical office said.
Production of automobiles jumped 13.4 percent, helping to power overall production for the month.
Domestic consumption, spooked by a crackdown on ballooning household debt and credit card spending as well as a big corporate scandal, remained weak as wholesale and retail sales declined 1.5 percent versus a 3.7 percent fall in November.
Corporate investment in plants and equipment was no better.
But December's 2.1 percent fall was an improvement from November's 8.3 percent slump, the office said.
Without taking seasonal factors into account, output grew 10.4 percent in December from a year earlier, versus a rise of 4.5 percent in November and an 11.4 percent advance in December, 2002.
The latest reading means industrial output for 2003 rose 5.0 percent versus an 8.0 percent increase in 2002.
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Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
