It appears that Korea is not doing well in these days. I remember that my first exchange on PEN-L was with Brad DeLong. I just casually wrote, without giving any reasons, at the time that Korea was at risk and he said, without giving any reasons other than quoting the Economist, that the IMF bailout of Korea worked fine. I wonder if he can say the same now.
Best, Sabri ++++++++++ Korea: Rising Risk of Hard Landing (Correction) Andy Xie (Hong Kong) We have argued that the Korean economy would achieve a soft landing from last year's credit surge. Our assumptions have been that the export recovery and the interest-rate reduction would cushion the downturn in consumption when the credit surge deflated. However, the export recovery is decelerating quicker than expected, and the credit bubble has lasted longer than expected. Full at: http://www.morganstanley.com/GEFdata/digests/20021004-fri.html ++++++++++ U.S. port closures batter Korea's economy Korea Herald, Oct. 5, 2002 The protracted closures of U.S. West Coast ports, which handle over 60 percent of Korea's U.S.-bound shipments, are casting a new shadow over the nation's export recovery, traders and their interest groups said yesterday. With the disruption of ports in U.S. West Coast states entering its fifth day Friday, export losses by Korean manufacturers of autos, electronics, foods and other consumer and industrial goods are snowballing, they said. The Korea International Trade Association (KITA) said that the suspension of U.S. ports, the gateway to $18 billion of Korean products annually, is costing Korean exporters about $50.5 million a day. In other words, 63 percent, or 440,000 TEU (20-foot equivalent unit of containers), of Korea's annual U.S.-bound exports of 700,000 TEU pass through the American West Coast ports, it noted. Morgan Stanley even warned that if the U.S. port closures extend for more than a month, it would thrust the East Asian economies into a fresh recession, noting that the ports handle about $1 billion of East Asian products. According to a report by the Korea Trade-Investment Promotion Agency (KOTRA), domestic food and automotive exporters, among others, have suffered the most serious damages from the weeklong port closures. Delayed customs clearance is devaluing or spoiling food shipments with limited shelf lives, while deliveries of autos, cameras, TVs, footgear and other products have been halted, resulting in significant sales losses. For instance, Hyundai Merchant Marine's cargo ships carrying hundreds of containers of kimchi, beer, soju, ramyon and daily necessities have been anchored offshore. "Food retailers usually maintain one week's worth of inventories of ramyon, soy and other bulk foods. Such inventories have nearly run out," said the KOTRA report. Hyundai Motor currently has a container ship carrying 570 vehicles stranded at the Portland Port, while the outlook for the automaker's additional shipments of 3,400 vehicles, scheduled until Oct. 10, remains unclear. KITA, meanwhile, said that at least 12 Korean cargo ships are currently stranded at U.S. West Coast ports, with each of them suffering $25,000 in operational expenses a day. "If Korean shippers opt to use U.S. East Coast ports due to possible protraction of the West Coast disruption, shipping cost will rise by $1,500 per TEU," said a KITA official. "Airlifting of cargos will also be four to five times more expensive." ([EMAIL PROTECTED]) By Yoo Cheong-mo Staff reporter Article at: http://www.koreaherald.co.kr/SITE/data/html_dir/2002/10/05/200210 050012.asp
