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[Alpha Biz=(Chicago) Reporter Kim Jisun] More than half of large companies failed to make investment plans for next year due to growing uncertainties surrounding companies, a survey showed.
According to a survey of the top 500 companies in sales by The Federation of Korean Industries on the 5th, 55.0% of 131 respondents said they have yet to set up investment plans or do not have plans. Specifically, 49.7% of 'investment plan undecided' and 5.3% of 'no plan' were surveyed. The proportion of 'undetermined investment plan' companies increased by 11.7 percentage points compared to last year.
"The economic outlook for next year remains uncertain due to lingering uncertainties such as high interest rates, strong dollars, the Russia-Ukraine war and the delayed recovery of the Chinese economy," said Choo Kwang-ho, head of The Federation of Korean Industries division at the Korea Business Association. "More than half of large companies have yet to come up with investment plans for next year."
The International Monetary Fund (IMF) released South Korea's economic growth forecast for next year at 2.4 percent in July, down to 2.2 percent in October. Although it will recover mainly from semiconductor and other export companies, it is predicted that it will not be an easy year for domestic companies.
Only 45% of the respondents set up investment plans for next year. Of the companies that said they set up an investment plan, 61 percent decided on the size of their investment at the same level as this year, while 28.8 percent said they would increase their investment from this year and 10.2 percent said they would reduce it.
One out of three respondents said investment will be activated from the second half of next year.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
