More than half of South Korean firms expect the economy to get worse in the second half of the year due to a continued rise in raw material prices, a poll said Tuesday.
According to the survey of 506 companies by the Korea Chamber of Commerce and Industry (KCCI), 55.3 percent of the respondents said that the economy will slow down in the second half, while 4.6 percent
said that the economy will be in much worse shape.
The companies cited a continued rise in raw material costs, including high oil prices, as the main reason for the gloomy outlook.
Regarding the current situation of the economy, 82.2 percent of the companies polled said that a rise in raw material prices is making the domestic economic conditions worse.
As for the small and mid-sized companies, 85.6 percent of them said the economic conditions remain weak, while 75.3 percent of big companies have the same assessment.
Decreased profits stemming from increasing raw material prices were cited as the biggest reason for their dark view of the current economy.
"Business conditions are forecast to be in a bad shape in the second half due to economic uncertainties both at home and abroad, including rising oil prices and concerns of the fiscal crisis in southern Europe," the chamber said.