I. Trends: Key Characteristics in the First Half of 2015
In the first half of 2015, the Korean economy grew slowly at a rate of 0.8 percent in the first quarter and 0.3 percent in the second quarter (2.5 percent and 2.2 percent, respectively on a year-over-year basis) largely due to contracted domestic consumption in the aftermath of the MERS outbreak and poor external sector performance. In terms of economic indicators, the cycle variation value of the leading composite index moved steeply upward in contrast to the continued fluctuation in the cycle variation value of the coincident composite index, resulting in a wider gap between the two indicators.

II. Impact of Interest Rate Hike in the U.S. and Devaluation of the Chinese Yuan on the Korean Economy
It is highly likely that the U.S. Federal Reserve will gradually raise interest rates. Though the Korean economy is emerging from the MERS crisis, it has not yet made a palpable recovery. In this situation, an interest rate hike in the U.S. will have potentially high negative impact on the Korean economy.
The devaluation of the yuan by the People’s Bank of China followed a run of weak Chinese economic data. China’s slowing economic growth as a result of a hard landing of its economy and the ensuing instability of the global market will likely have a stronger negative impact on the Korean economy than does the devaluation of the yuan itself. This is because China’s economic growth rate has become more closely correlated with Korea’s export to China following the global financial crisis.

III. Decline in Exports: Key Characteristics and Implications 
Korea’s export performance in the first half of 2015 fell by 5.1 percent from a year ago. Of note, this level of decline in exports over two or more quarters has occurred only three times in the last 15 years. The recent decrease in exports can be attributed to falling oil prices, depreciation of the Japanese yen (Korea competes with Japan for exports), and changes in China’s import policy. 

IV. Discussions about and Implications of the Google Tax 
Google tax is a term coined to refer to all kinds of levies imposed on multinational digital companies like Google. The need for such taxation has been raised to address unfair transactions and tax avoidance by digital multinationals. Because advantageous international transactions and associated tax avoidance using multinational position constitutes an encroachment on tax revenue sources, the Google tax will possibly become a more important source of corporate tax revenue.

V. Tax Revenue Performance in the First Half of 2015 (From January to June) 
The tax revenue in the first half of 2015 stood at 106.6 trillion won, an increase of 8.3 percent (8.2 trillion won) over the previous year (98.4 trillion won). The increase in tax revenue during this period is attributable to rising revenues from transfer income tax and stock exchange tax as the asset market recovers, and more income tax revenues following a tax law revision and the institution of a more robust tax-collection regime.