SEOUL, Aug. 7 (Xinhua) -- The South Korean economy faced downside risks over the global trade dispute and Japan's export curbs on the country, a state-run think tank said Wednesday.
The Korea Development Institute (KDI) said in its monthly economic assessment report that the slump in the South Korean economy continued amid the weakening of export and corporate investment.
The institute warned that if the global trade friction and the South Korea-Japan trade spat deepens, the country's economic situations could deteriorate further.
Japan took South Korea off its whitelist of trading partners, which are given preferential export procedure, last week, after tightening regulation on its export to South Korea of materials, vital to make memory chips and display panels, last month.
The country's export kept falling for the eighth consecutive month through July amid the global trade friction and the downturn in business cycle of the global chip industry. Japan's export curbs added to the external uncertainties.
South Korea's production in all industries slipped 1.1 percent in June from a year earlier, after growing 1.2 percent in the previous month.
Retail sales, which reflect private consumption, rose 1.2 percent in June from a year ago thanks to the government's efforts to raise household income, but it slowed down from a growth of 3.4 percent tallied in May.
Facility investment declined 9.3 percent last month on a yearly basis on the semiconductor industry downturn.
The construction industry continued to weaken amid the government's measures to control speculative investment in the real estate market.