Yonhap reported that South Korean exporters' business sentiment for the third quarter fell sharply mainly due to persistent euro zone woes that are weighing down global trade.

The report by the Export-Import Bank of Korea showed the export business index standing at 99 for the three month period, down from 112 tallied for the second quarter. A reading below the break even 100 mark means pessimists outnumber optimists.

It said the index reading is the same as what was tallied in the first quarter of this year, but a gain from the low of 73 reached in the first quarter of 2009. The findings were based on a poll conducted on 452 exporters, including 130 large businesses.

The state run bank said that "The general economic slowdown in South Korea's trading partners has been hurt by Europe's fiscal troubles, and it is likely the drop in demand for locally made products has affected the index." It said companies were also concerned about a drop in price competitiveness in the coming months.

Reflecting the weak conditions down the road, Korea Eximbank's latest findings showed the country's export volume index hitting 102, from 118 predicted for the previous quarter.

By size of business, the future index for large companies fell to 100 from 110 recorded in the previous quarter, while numbers for small and medium enterprises stood at 99, down from 104.

The bank, meanwhile, said it plans to inject KRW 1 trillion worth of fresh funds to help the country's shipbuilders and marine platform exporters this year, which have been hit hard by the sharp drop in orders from overseas shipping lines.

The additional money will increase the funds to be made available to KRW 15.6 trillion and could alleviate some of the pressure felt by local industries.

Source - Yonhap News

(www.steelguru.com)