Korea 2016 by Organisation for Economic Co-operation and Development, author instant download

Korea 2016 by Organisation for Economic Co-operation and Development, author instant download

1 online resource, Output growth slowed to a 2 per cent annual rate over 2011-15, still higher than the OECD average, while inflation has remained below the central bank's target. Although export growth has been sluggish, the current account surplus has risen to nearly 8% of GDP, reflecting weak domestic demand, falling oil prices and transitory demographic trends. Robust residential investment is one bright spot, as the policy interest rate has been cut to a record low. However, high household debt is constraining private consumption, although it does not pose a systemic risk to the financial system. Fiscal stimulus was effectively used in 2015 to support growth. The fiscal situation is sound, with the budget in surplus and the government a net creditor. Labour productivity (output per worker) slowed to around 1% over 2011-15. The level of labour productivity in the service sector is less than hal f of that in manufacturing. SME policy promotes the survival of small firms, rather than higher productivity, and very few grow into medium-sized firms. Venture capital investment has had limited effectiveness in encouraging innovative startup companies. Product market regulation is among the most stringent in the OECD area. The gains from Korea's high level of investment in R & D are limited by structural weaknesses in the innovation system. However, following the introduction of the Three-year Plan for Economic Innovation in 2014, progress is being made, notably in regulatory reform and the R & D and venture ecosystems, Scholarly & Professional