economy-trade dependence

SEOUL, April 2 (Yonhap) -- South Korea's dependency on trade has stayed above 100 percent over the past three years, reflecting high risks of being swayed by external factors, data showed Tuesday.

The proportion of South Korea's trade to its gross national income (GNI), a gauge of a country's trade dependence, stood at 112.7 percent at the end of last year, according to the data by the Bank of Korea and the Ministry of Trade, Industry and Energy.

The ratio has stayed above the 100 percent mark since 2010, when it had reached 105.2 percent.

The figure hovered around 77 percent in 2000 before rising to 85.9 percent in 2007 and 110.7 percent in 2008 in the wake of the global financial crisis. It then fell to 98 percent in 2009 but went up again to 100 percent in 2010.

Market watchers said the growth in the trade-GNI portion shows Korea has been suffering from a sluggish domestic economy.

With household income not growing enough to meet spending and saving demand, the country has experienced a number of financial troubles abroad.

The country's household debt has reached a record 959.4 trillion won (US$861.9 billion) as of the end of December, feared to spawn massive defaults, amid a prolonged slump in the housing market.

The government has revised down the growth rate for this year to 2.3 percent. The South Korean economy expanded 2 percent last year, the slowest in three years.

Analysts have projected Korea could be hit hard if the global downturn persists, given that a weakening Japanese yen has emerged as another big risk factor that threatens its exports.

"We may be able to see Korea escape from the 1-percent growth from the third quarter due to the base effect, but for now, it's difficult to expect a big hike in the figure in future," said Lee Jong-woo, the chief analyst from I'M Investment