S Korean Economy Faces External Uncertainties

South Korean economy still faces external uncertainties such as the political unrest in the Middle East, the devastating earthquake in Japan and the European fiscal crisis, a government report showed Thursday.

The country's economy continues to see improvements in economic conditions and employment, but economic indicators slowed down a bit, with consumer prices keeping rising, the Ministry of Strategy and Finance said in a monthly report assessing the latest economic situations.

Production in mining and manufacturing industries fell 2.3 percent on-month in February, but the industrial activities, excluding seasonal factors, kept its upward trend, the ministry said. Labor market also maintained its recovery trend with its employment rising 469,000 in February.

The ministry noted, however, external uncertainties, including the Mideast unrest, the Japan's quake and the European debt problems, deepened further despite the global economic recovery.

Rising oil prices, caused by the geopolitical risks in the Middle East, led the country's consumer prices to rise at a faster pace. South Korea's consumer prices jumped 4.7 percent in March from a year earlier, with core prices, excluding oil and food, gaining 3.3 percent.

The finance ministry said it will manage its macroeconomic policy flexibly, watching closely the developments of external conditions in a bid to maintain improvements of economy and employment amid stable consumer prices.