South Korea's economy expanded quarter-on-quarter, as Asian economies shake off the pandemic's worst effects and return to growth.
During the July to September period, Asia's fourth largest economy reported a GDP growth of 1.9 percent from the previous quarter aided by a strong recovery in the country's exports of cars and memory chips.
This comes after the country had fallen into a recession earlier this year after two straight quarters of contraction.
Against this backdrop, President Moon Jae-in addressed the parliament today regarding the state budget. He said his administration has drawn up a roughly 469.8 billion U.S. dollar budget bill for next year and that along with this budget, the government would focus on creating new jobs and reinvigorating the economy.
Let's talk about it.
I have joining me live in the studio, Song Soo-young, Professor of Business and Economics at Chung-Ang University. And, later on the show, we'll link up with Christophe Andre, senior economist at the OECD in Paris.
But, first, Professor Song, it's great to see you in the studio.
Next year's budget as proposed by President Moon today is a record-high with an 8.5 percent hike from this year's budget.
How does such a budget play into putting South Korea's economy back on a normal track for next year?
Much of the recovery and even a turnaround from negative to positive have been attributed to a pick up in exports, especially in cars and memory chips.
What are your thoughts and will this rise continue into the fourth quarter and even next year?
Some analysts have said that South Korea has been in something of a sweet spot amidst the COVID-19 era as the world shifted to work and study-from-home.
How do you believe Korea's Digital New Deal play towards a pick up in other areas?
Let's now turn for perspective from the OECD.
Christophe Andre , senior economist at the OECD, joins us live from Paris.
Christophe, thanks for speaking with us tonight.
Andre, South Korea turned positive in the third quarter, but China has steadily been reporting positive growth amid the pandemic.
Not only did they report positive growth for two consecutive quarters, but its third quarter growth was at 4.9 percent. Is China on path to a clear V-shaped recovery and how will China's quick recovery impact the Korean economy?
Unfortunately concerns have risen over a double-dip recession in the U.S. and European countries.
Would that be a blowing factor for the South Korean economy, as well?
With the U.S. elections just around the corner now, the stimulus policies the U.S. may call for is still uncertain.
There are also worries that China's successful economic recovery could deepen the U.S., China trade conflict.
How vulnerable is the South Korean economy to the souring U.S., China trade relations?
Andre Christophe, senior economist at the OECD. Many thanks for your insights. We appreciate it.
Though not a V-shaped recovery, and still behind in GDP trend compared to this time last year,
the South Korean economy has recorded positive growth for the first time since the outbreak of COVID-19.
Further outlook on economic recovery seems to be positive as consumer sentiment in October recorded the biggest increase since 2009 as social distancing measures ease back to level 1.
With what remains of this calendar year, where can we hope consumer spending to increase to keep the national economic recovery on its uphill trend?
Between a V-shaped, U-shaped and a Nike swoosh-shaped, what kind of a post-pandemic recovery can we expect for South Korea?
Song Soo-young, Professor of Business and Economics at Chung-Ang University, many thanks for your insights and expertise. We appreciate it.