

The Global Economy Just Entered a Dangerous New Phase
11 snips Apr 27, 2025
A significant economic downturn is looming in South Korea, prompting government bailouts and pressure for interest rate cuts. Meanwhile, the effects of U.S.-China trade war tariffs are felt as Chinese factories slow down, leading to worker layoffs and production halts. South Korea is strategizing to enhance its competitiveness in high-tech sectors while struggling to stabilize its delicate economy. The global economy faces an uncertain future as these trade tensions intensify.
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South Korea's Fragile Pre-Tariff Economy
- South Korea's economy has been stagnant for several quarters before tariffs hit, marking a fragile growth environment.
- This long-term stagnation predates recent trade shocks, showing deep structural issues.
Economy Inflection March-April 2024
- The global economy experienced a significant inflection around March-April 2024, worsening Korea's growth plight.
- South Korea exemplifies a "forgot how to grow" economy, facing multiple recessions within recessions.
Korea's Slowing Growth Outlook
- South Korean officials acknowledge that growth is effectively zero and likely to worsen.
- The Bank of Korea is expected to significantly lower its 2025 growth forecast from 1.5% closer to zero.