Tensions With North Korea Unsettle South’s Economy
Source: New York Times
Tensions With North Korea Unsettle Souths Economy
By CHOE SANG-HUN
Published: April 5, 2013
SEOUL North Koreas torrent of threats and the matching show of military power and political resolve from the United States and South Korea began showing signs of unsettling foreign investors confidence Friday.
The development magnified the challenge Seoul and Washington face. The two powers are trying to show the Norths novice leader, Kim Jong-un, that they will not be blackmailed by his bluff and bluster. But at the same time, they do not want to escalate the tensions to an extent that they hurt the South Korean economy, the pride of the local population here, and Park Geun-hyes political standing at home.
In the past, North Korea-related events had little impact or the markets recovered quickly, the Souths vice finance minister, Choo Kyung-ho, told a meeting of top finance officials on Friday. But recent threats from North Korea are stronger and the impact may therefore not disappear quickly.
His comment came hours after General Motors chief executive, Dan Akerson, underscored the increased worry by saying that his company was making contingency plans for employee safety at its South Korean plants and that further increases in tensions would even prompt GM to look at moving production elsewhere long term. In an interview with CNBC, he said, If there were something to happen in Korea, its going to affect our entire industry, not just General Motors.
South Korean stocks slumped 1.64 percent on Friday in a selling spree among foreign investors that analysts attributed to jitters over North Korea. The Korean won also sank against the U.S. dollar.
Read more: http://www.nytimes.com/2013/04/06/world/asia/tensions-with-north-korea-unsettle-souths-economy.html?pagewanted=all&_r=0
John2
(2,730 posts)could destroy both economies and affect the U.S. economy also, yet with another War, that have to be payed for. I do not think hostilities will stop there either in the long term when you look at the Middle East and Afghanistan. Americans think in the the short term but do not consider the whole picture of protracted Wars. Wars have to be payed for period. You have to think about the troops that get maimed from these conflicts too. It will not affect those that decide these Wars or the well off one bit. You have to make plans for the destruction of the environment also considering the massive chemical arsenal ( and possibly nuclear) the North Korean military possesses. if any side thinks they have a clear easy road, then they are living in a fairy tale. The best solution to avoid it is to come to a negotiated agreement instead of saber rattling and listening to the warmongers.