Spending by Korea's households dropped to the lowest-level on record last year.
People are choosing to refrain from making purchases as income-growth slows,... and debt mounts… amid feeble recovery momentum.
Our Hwang Ji-hye looks into this trend.
Facing sluggish recovery momentum,... Korean households are leaning towards saving money instead of spending it.
Statistics Korea says... the average propensity to consume stood at 71-point-9 percent last year -- the lowest level since the related data was first compiled in 2003.
The record-low figure comes on the back of subdued growth of households' income... that rose at the slowest pace last year since 2009... when the country was hit hard by the global financial crisis.
The average annual income of households stood at slightly over 4-point-3 million won,... which is roughly 35-hundred U.S. dollars.
The slow growth came as earnings of those self-employed dropped... after the MERS outbreak put a dent in overall consumption... which had already been suffering from the fizzling economy.
And experts say the trend to refrain from spending is not expected to change in the near future... as it's also stemming from longer-term challenges like the aging population and mounting household debt.
"The government is pouring efforts into propping up domestic demand through measures like cutting consumption tax, but such measures will have limitations because the current slowdown is a result of structural issues."
So, the latest figure once again points to the importance of pushing through the structural reforms... that President Park Geun-hye has been emphasizing since last year.
But experts say that the two years remaining in her term... is not enough time to realize such reforms,...and that the Park administration should focus more on laying out a solid plan... than actual results.
Hwang Ji-hye, Arirang News.
