SEOUL, KOREA - As the Japanese economy went through the lost decades, it turns out, the gap with the Korean economy has narrowed substantially. The ratio of the two economies in the global total GDP this year was 1.96 and 5.58 percent, respectively, slight below three times. In 1990, in contrast, the difference had been more than seven times.
According to the World Economic Outlook published by the International Monetary Fund on December 25, Korea's GDP this year has been USD1,234 billion (preliminary). Only 22 years ago in 1990, the respective shares in world total were 1.43 and 10.09 percent.
Japan's share in the world has steadily declined since a peak in 1991 when it was 10.22 percent due to the real estate bubble burst. It fell to the 8-percent level in 1995 and the 5-percent level in 2009.
Last September, the two countries saw their sovereign credit ratings reversed. International credit rating agency Fitch upgraded Korea's credit rating to "AA-" from previous "A+," making it one notch higher than that for Japan. Earlier, Fitch had downgraded Japan's sovereign rating by two notches because of the nation's high public debt level.
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*Article provided by The Korea Economic Daily
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