More gloomy news for the South Korean economy.
A newly-released survey by the Korea Chamber of Commerce and Industry shows South Korean companies are struggling to generate new growth momentum and are losing ground to rivals around the world.
Kim Hyesung reports.
South Korean companies are sandwiched between those from developed and developing countries, struggling to come up with new future businesses and fully utilizing technologies related to the fourth industrial revolution.
These are the bleak findings of a new survey by the Korea Chamber of Commerce and Industry on 500 local manufacturing companies.
More than 41 percent of respondents said their competitiveness is at the level of or behind emerging countries like China.
That's four times higher than the corresponding result in 2010 when only ten percent of local firms said that was the case.
More than 60 percent of those surveyed said they are behind advanced countries like the U.S., a whopping 20 percentage points higher than the 2010 survey.
"South Korean companies are losing competitiveness mainly due to a lack of innovation. Technology convergence across manufacturing, IT and services is the new trend of the fourth industrial revolution. But regulations are so stifling that it's difficult for companies to try new things. Other countries have already eased regulations to encourage investment and nurture experts."
In fact, two out of three companies surveyed said they haven't found new businesses as a source of growth, citing a lack of technology, funding, and strict regulations.
Near half said they aren't using new technologies related to the fourth industrial revolution such as AI and big data, and only six percent said they're actively using the technologies.
A separate report on corporate management by the Bank of Korea released on Tuesday shows South Korean companies posted negative revenue growth in the first quarter mainly due to the sluggish manufacturing sector, including firms in the electronics and petrochemical industries.
Their debt ratio also increased on-quarter.
The Korea Chamber of Commerce and Industry says a firm platform to nurture fourth industrial revolution-related technology, improved corporate investment and deregulation are required to ensure South Korea's manufacturers stay globally competitive in the years to come.
Kim Hyesung, Arirang News.
