Gwangju Employers Federation Urges Inclusion of Domestic Market Recovery Measures in Presidential Pledges

Damage to Small Business Owners Worsens Due to High Inflation and Sluggish Domestic Demand
Business Sentiment Fails to Recover to Baseline for 11 Consecutive Quarters
"Practical Support Needed, Including Expanded Financial Assistance"

The Gwangju Employers Federation on the 23rd urged that measures to revive the stagnant local economy be included in presidential election pledges.

In a press release issued that day, the Gwangju Employers Federation stated, "A combination of complex issues, including the impeachment of the president, a sluggish domestic market, and risks stemming from Trump, have resulted in a prolonged domestic downturn."

The federation emphasized, "Recently, there has been much talk about the difficult economic situation, but this goes beyond mere sentiment. It reflects the real challenges that companies in the Gwangju region are facing on the ground." The federation further highlighted that ▲the prolonged period of high inflation and high interest rates is increasing management burdens ▲the slump in domestic demand is worsening ▲and heightened uncertainty is leading to reduced investment and hiring. As a result, small business owners and SMEs are facing even greater difficulties.

They added, "Furthermore, small and medium-sized enterprises and small business owners are suffering from multiple hardships, including rising costs, declining sales, funding shortages, and difficulties in hiring. This is a serious issue that could undermine the very foundation of the local economy." The federation explained, "The prolonged high inflation and high interest rate environment is causing consumer sentiment to continue to decline. Persistently high inflation is simultaneously worsening profitability for businesses due to increased production costs, and reducing household purchasing power, thereby shrinking consumption."

Additionally, the federation pointed out, "In fact, the business sentiment index has failed to recover to the baseline (100) for 11 consecutive quarters since the third quarter of 2022 (114)." The main reasons cited were ▲weakened consumer sentiment due to continued high inflation (57.4%) ▲domestic political uncertainty (46.8%) ▲increased cost burdens (40.4%) ▲imposition of U.S. import tariffs (17.0%) ▲the growing influence of Chinese e-commerce in the domestic market (12.8%) ▲and rising import prices due to exchange rate increases (12.8%).

The federation also stressed the urgent need for practical liquidity support and cost relief measures that can immediately provide breathing room, such as ▲expanding financial support ▲reducing various cost burdens ▲measures to stimulate domestic demand ▲and eliminating unnecessary regulations.