8 out of 10 Economists Say "Trump Administration Policies Negatively Impact Our Economy"

Eight out of ten domestic economists predicted that the policies of the U.S. Trump administration would have a negative impact on the South Korean economy. This analysis is based on the view that the Trump administration's protectionist trade policies will generally have a greater negative effect on our export-dependent economy.

On the 2nd, the Korea Employers Federation announced the results of a "Recent Economic Situation and Major Issues Survey" conducted among about 100 economists. According to the survey, 83% of respondents answered that the overall impact of the U.S. Trump administration's policies on our economy would be more negative.

Survey Results on the Impact of the US Trump Administration's Policies on the Korean Economy. Provided by the Korea Employers Federation

Additionally, the average economic growth rate forecast for this year presented by 100 economists was 1.6%, which is lower than the government's forecast of 1.8%. When asked about the state of our economy, 64% responded that "growth will stagnate for a considerable period." The next most common answer, at 35%, was "after a certain period of decline, a gradual recovery will continue." Regarding the outlook for the overall industrial competitiveness of our country, 56% responded pessimistically, the highest proportion.

When asked to score the urgency of policies needed to enhance global competitiveness and overcome low growth on a scale of 10, the responses showed that over 90% agreed on the necessity of ▲promoting industrial structural reform ▲advancing the labor market ▲improving corporate regulations, with more than 70% also rating these as highly urgent.

For global competitiveness, 65% responded that the current highest corporate tax rate (24%, central government standard) should be lowered further. Additionally, 76% agreed that the current highest inheritance tax rate (60%, including the surcharge on major shareholder stocks) should be reduced or abolished and replaced with a capital gains tax to ensure corporate continuity.

Regarding the impact of the recent impeachment political situation on the economy, 57% answered that it would have a negative effect in the short term but would not significantly affect the medium to long term. Meanwhile, 40% responded that it would have a negative impact both in the short term and medium to long term.