Source: BMI in ----, it would cost up to - of annual GDP for a period of -- years. This is assuming a peaceful unification scenario, which is by no means assured. economic Bonanza not seen as Worth the cost Park has been keen to play up the positive impact of reunifi- cation that could be reaped from the marriage of the South s capital and technology with the North s human and natural resources. According to a policy research assignment report that was submitted to the Ministry of Unification by the Korea Political Science Association (KPSA), if the two Koreas were unified by ----, over the next -- years, an annual average of KRW--.-trn (USD--bn) in government spending would be invested in North Korea in the form of social overhead capital , while it is estimated that the production spinoff amount would reach an annual average of KRW--.-trn won for the next -- years, amounting to a -.- times return on its financial invest- ment. While we share the view that ultimately a successful reunification could lead to a huge economic boom, the path to such a boom is fraught with too many costs and political risks that it is unlikely to happen any time soon. ...That said, Park looks likely to maintain her level of rhetoric surrounding reunification owing to the political benefits in appealing to those who would traditionally support the opposition and its softer line towards the North, favouring contact, opening up and talk of reunification over sabre-rattling and talk of war. - Business Monitor International Ltd www political outlook security threats Weigh on ratings
...The South Korean leadership s increasing rhetoric on the benefits of eventual reunification with the North does not alter our view that such an eventuality is highly unlikely. While a collapse in the North Korean regime remains the most likely scenario under which reunification would come about, the status quo is likely to remain in place for the foreseeable future . ...In addition, owing to the single-term restriction on the presidency, most presidents typically become lame ducks well before departing office, leaving the country in a state of drift. chapter -: economic outlook -- sWot analysis -- BMi economic risk ratings -- economic activity -- investment rebound, trade resilience to support Growth outlook South Korea s relatively strong Q--- real GDP growth print has prompted us to upgrade our ---- growth forecast to -.- from -.- previously. Korean exporters will continue to ride on the economic recovery in the developed markets for now while a recovery in real estate sector may support construction investment. ...target as the high level of household debt will cap consumer demand.
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