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Asia Shows Mixed Signs of Economic Health - 2004-06-21

Singapore's retail sales dropped in April, but Malaysia saw some upbeat economic news. However, South Korea's job market continues to slump.

Singapore's retail sales fell almost nine percent in April compared with March, to $1.2 billion. However, compared with a year go, sales were up more than 14 percent.

Song Seng Wun, an economist with the investment bank G.K. Goh says part of the jump from last year is due to the recovery from the outbreak of Severe Acute Respiratory Syndrome last year, which kept people out of the stores.

"You must recall this time last year this region in SARS. Many people stayed home," he says. "Because of that we have a low base of comparison and retailers trying to offer the best deal since."

Mr. Song notes that auto sales surged 16 percent in April from a year ago, boosting Singapore's retail sales. But the gain was in part the result of the government easing restrictions on car ownership.

Singapore's non-oil exports rose nearly 12 percent in May, compared with April, driven by rising global demand for semiconductors and pharmaceuticals. However, economists say that pace of growth is unsustainable and will slow in coming months.

Also in Southeast Asia, Malaysia reported that manufacturing sales surged 25 percent to $8.6 billion in April, compared with the same month a year ago. That was due to rising demand for exports.

South Korea's economy however, remains sluggish, with the job market showing little improvement as domestic demand slumps. The country's unemployment rate rose to a five-month high of 3.5 percent in May, as more university graduates apply for jobs. In April, unemployment was 3.4 percent.

Hong Kong's unemployment rate on the other hand slipped to a two-year low of seven percent in the three months to May. That was down from 7.1 percent in the previous three months. Most jobs were created in the construction and trade sectors as the property development market recovers from a six-year slump.