South Korea's business sentiment for May remains pessimistic due to the prolonged Middle East crisis, a Federation of Korean Industries survey showed Thursday. The business survey index for the top 600 companies by sales stood at 87.5, below the 100 benchmark where pessimists outnumber optimists. This marks two consecutive months below the line.
The Federation of Korean Industries (FKI) monthly poll of the country's top 600 companies by sales showed a business survey index (BSI) of 87.5 for May. A reading below 100 signals more pessimists than optimists. Manufacturing stood at 86.5, while non-manufacturing was at 88.4.
Within manufacturing, the oil refinery and chemical industry reported 89.7, and the automotive and transportation equipment sector posted 82.8. The FKI attributed the gloom to hikes in crude oil prices and shipping costs.
"To prevent external shocks from eroding the competitiveness of Korean companies, the government should support price stability for petroleum products, including naphtha and oil and gas, while swiftly preparing supplementary measures to minimize disruptions in raw material supplies and production," said Lee Sang-ho, head of the FKI's economic division.
A plastic bag factory in Ansan, south of Seoul, had shut down in March due to raw material shortages from Middle East tensions, according to a photo caption.
