The Hana Institute of Finance has announced that most South Korean industries are likely to experience a modest recovery in the coming year, with the rechargeable batteries, automobile and shipbuilding sectors expected to show strong growth. It is important to take into account the slowing of China’s economy, the strengthening of global environmental regulations, and the introduction of new technologies, as these will have mid- and long-term effects on local industries. The institute noted that, aside from those mentioned, the recovery of other industries will be on a low base effect.
The rechargeable battery sector is expected to be the driving force of the parts and materials sector in terms of both size and profitability, due to its large order backlog. The semiconductor industry may see some improvement in its prices, however, it will still be facing slow demand. On the other hand, the petrochemical industry is expected to suffer from a “severe recession” due to the combination of decreasing demand, high oil prices, and oversupply.
The Hana Institute of Finance has also highlighted that South Korean industries are exposed to the mid- and long-term effects of the changes in China’s economy, global environmental regulations, and new technologies. It is necessary for businesses to take proactive measures in order to survive and grow. The institute further added that the application of digital technologies, although it may be low in the short-term, will eventually become a whole new industry in the long-term.