The Korea Economic Research Institute has picked the top five issues facing the South Korean economy next year.
 
During a seminar on Tuesday, the institute unveiled that it believes the top five hurdles are: the China risk; an export war among South Korea, China and Japan; the interest rate policies of South Korea and the U.S.; corporate restructuring; and structural reform.
 
The institute said South Korea must address the China risk with strategic tactics, including securing a comparative advantage and advancing into China’s market.
 
The institute assessed that South Korean companies are falling behind Chinese and Japanese firms in terms of price competitiveness. In particular, the institute said the devaluation of the Chinese yuan could emerge as an additional risk to South Korean exports.
 
On a possible interest rate hike by the U.S., the institute said South Korea would have to consider marking up its key interest rate gradually after the second half of next year.
 
The institute also stressed the need for parliament to swiftly pass a special bill aimed at breathing new life into the business environment in order to promote corporate restructuring.