S. Korea's business sentiment gets stagnant on corporate restructuring

Confidence among South Korean businesses got stagnant this month on worries about the government-led corporate restructuring in shipping and shipbuilding industries, central bank survey showed on Monday.

The business sentiment index (BSI) for manufacturers stood at 71 in May, unchanged from a month earlier after improving for the previous two straight months, according to the Bank of Korea (BOK).

The index was based on a BOK survey of 2,797 manufacturers and non-manufacturers. The reading below 100 means pessimists outnumbered optimists.

After bottoming at 63 in February, business sentiment among manufacturers rebounded to 68 in March and 71 in April, before showing stagnancy in May.

It was attributable to rising concerns about shipping firms and shipbuilders, toward which the South Korean government has forced restructuring amid continued losses and falling orders.

The BSI for shipbuilding and other transport companies tumbled 4 points from a month earlier to reach 49 in May, the lowest in four months.

Manufacturers picked weak domestic demand, economic uncertainties and slowing exports as main difficulties in doing business.

The BSI for non-manufacturers came in at 71 in May, up 1 point from a month ago. But, the prospective BSI for non-manufacturers in June declined 2 points at 73. Enditem