Accountants' 2024 First Half Economic Outlook: "Difficult Except for Shipbuilding and Machinery"

Joseon, excluding machinery, BSI falls below baseline of 100
Comprehensive BSI for H1 is 76, higher than 72 in H2 2023
Global economy, inflation, and currency expected to have impact

Certified Public Accountants (CPAs) have forecasted a bleak economic outlook for the first half of next year. According to a survey conducted by the Korean Institute of Certified Public Accountants on the 28th, targeting CPAs with expertise and experience in economics and industry (including full-time CPAs at partner level or higher in accounting firms and CPAs on leave holding executive positions in corporations), the Business Survey Index (BSI) for the first half of 2024 was 76. The BSI uses 100 as the baseline, with values above 100 indicating economic improvement and values below 100 indicating economic deterioration. The BSI for the second half of 2023 was 72.

By industry, except for shipbuilding (143) and machinery (106), the current (and forecasted) BSI for most industries fell below the baseline of 100. Sectors such as finance (97), information and communications (87), and electronics (86) showed a pessimistic outlook. Although there is some expectation that the growth trend will continue as export sluggishness somewhat eases, the outlook remains unfavorable due to persistent uncertainties caused by geopolitical risks and the prolonged monetary tightening policies of major countries.

The major detailed factors expected to impact South Korea's economy over the next year include ▲ global economic trends (27%) ▲ raw material prices and inflation (17%) ▲ changes in monetary policy direction and funding environment (tightening stance, base interest rate hikes, etc.) (15%) ▲ household and corporate debt levels (15%). Along with these insights, a special contribution article on the global economy and the 'Several Perspectives on the 2024 Economy' will be published at the end of this month on the Korean Institute of Certified Public Accountants' website in CPA BSI issue 19, presenting the economic outlook and response strategies for next year.