Business people in South Korea express concerns over their country's export levels and Japanese officials react angrily to a credit ratings downgrade.

South Korean business confidence dropped in May due to concerns that exports may not rebound soon. Executives fear that lower than expected growth in the United States its top trading partner - will hurt Korean exports.

The Federation of Korean Industries' business conditions index fell to 121 points from 143 points a month earlier.

Another factor that could undermine the country's export competitiveness is the robust Korean currency, which makes the country's goods relatively more expensive in overseas markets. The won is trading around 1,230 against the dollar, near a 17-month high hit last week. It has been rallying for about six weeks and has climbed eight percent on the dollar since mid-April.

Deputy Prime Minister Jeon Yun-churl attributes the rise to a healthy economy, and says that the government is ready to intervene if the won becomes too strong.

A strengthening currency has also prompted the Japanese central bank to intervene in the currency markets at least three times in the past two weeks to curb the rising yen. It too, fears a stronger yen will dampen overseas sales of goods such as cars and electronics.

Japanese finance officials are still reeling from a ratings cut by influential U.S. ratings agency Moody's Investors Service. On Friday it trimmed Japan's sovereign debt rating by two notches on concerns about mounting government debt and a lack of tough economic policies.

Japanese Finance Minister Masajuro Shiokawa says Japan will not change its economic policies regardless of how financial institutions such as Moody's evaluate them.

Chief government spokesman Yasuo Fukuda says that Moody's downgrade is too low. He says that the cut was one-sided and does not reflect Japan's strengths.

The Philippine economy slowed down in the first quarter of this year. Data issued by Manila show that gross domestic product expanded 3.8 percent in the first quarter, down from 3.9 percent in the previous quarter.

The government says it is confident that the Philippines' full year growth rate will be one of the best in Southeast Asia.