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former US Federal Reserve Chairman

“If the South Korean economy is to make it to the next level, it needs to not only increase exports but also build up the domestic market.”

On May 27, former US Federal Reserve Chairman Ben Bernanke, 62, said that the main economic task facing South Korea was the structural change of expanding the domestic market.

In a public discussion at the Dong-A International Finance Forum, held at the Lotte Hotel in Seoul, Bernanke said, “It’s difficult to maintain an economy the size of South Korea’s depending on exports alone. If South Korea is to become richer, it cannot solely depend on the international market. It needs to build up the domestic market and move toward a model in which exports and domestic demand are balanced.”

“A number of developing countries have gotten results from focusing on the manufacturing sector and selling products made at home to other countries. However, when the size of the economy grows, an export-led economy is unlikely to create enough jobs at home and will always be vulnerable to fluctuations in the global economy,” Bernanke said.

“In order to acquire a stable domestic market structure, on the demand side healthy consumer expenditures ought to account for a substantial portion of the total economy, while on the supply side growth should be diversified across several industries instead of being concentrated in one specific industry.”

By Hong Seok-jae, staff reporter

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