This report examines the “characteristics and implications of the recent domestic economic recovery and economic status by region.”
   
    The Korean economy, which has demonstrated gradual recovery since Q4 2012, is found to be recovering at the slowest pace compared to the past three economic recoveries since the end of 1990.
   
    The domestic economy is expected to rise with the global economic recovery thanks to the recovery of developed countries, including the US, and the impact from declining prices of international raw materials such as crude oil. The speed of Korea’s economic recovery in 2014 is expected to be substantially influenced by the level of facility investment recovery. The projected figures for facility investment in 2014 significantly vary by research institution as high uncertainties remain over global/domestic economic trends, corporate profits, and financing.
   
    It is important to develop new growth engines through the convergence between industries and between industries and culture and to improve the facility investment environment through deregulation and economic stimulus policies. It is also necessary to enhance product portfolios through R&D and to reinforce the technological level of capital goods including materials/parts and machines, etc. and increase investment to transform them into high value-added goods. The establishment of an environment where people actively set up new companies and small- and mid-sized firms can smoothly grow into large companies is also vital. In addition, it is imperative to quickly provide financial support for prospective companies/industries and properly restructure marginal companies. As for IT-related industries, the development of new high value-added growth businesses is essential and there should be enhanced incentives for domestic investments so that overseas investments can be redirected to domestic investments.