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Economy Watch
Economy Watch follows the progress of the world economy and offers you our weekly picks. Be sure to visit for the weekly updates.
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January 28 Updates
| S. Korea's land prices rise in 2009 despite economic slump
South Korea saw a year-on-year increase of 0.96 percent in average land prices in 2009 despite an economic slump, the government said on 26 January.
According to the Ministry of Land, Transport and Maritime Affairs, South Korea's land price has been steadily rising since last April, increasing 0.1 to 0.3 percent monthly on average, after falling 5.3 percent from November 2008 to March 2009.
Compared to the pre-crisis level in October 2008, the ministry said, land prices have plunged 3.2 percent at the end of 2009.
By region, Incheon, Seoul, and the Gyeonggi Province, which altogether make up a metropolitan area, saw a land price hike of 1. 99 percent, 1.40 percent, and 1.22 percent, respectively.
Hanam, located to the southeast of Seoul, marked the highest surge in land prices with a 3.72 percent on-year increase mainly due to the government's plan to construct a large-scale apartment complex for low-income families, according to the ministry.
Ongjin, located near Incheon, also saw a 3.21 percent hike in prices as the construction of the Incheon Bridge boosted up investors' expectations, the ministry said.
Non-metropolitan regions, however, showed a lower growth in land prices, with a 0.24 percent gain on average, the ministry said.
Land transactions also remained robust in 2009, in terms of size, with a total of 2.49 billion square meters of land being traded, up 3.8 percent year on year, the ministry added.
Japan's corporate service prices fall for 15th straight month
Japan's corporate service price index (CSPI) fell for a 15th straight month in December, according to preliminary figures released by the Bank of Japan (BOJ) on Tuesday.
The prices businesses pay for services such as transportation and advertisements declined 1.5 percent from a year earlier as the slower economic recovery prompted companies to cut costs.
December's decline slowed from a revised 2.2 percent fall in November and a record drop of 3.5 percent marked in August, which was the largest year-on-year drop since the BOJ began compiling CSPI data in January 1985.
The total CSPI, which stood at 97.8 in December against 100 in the 2005 base year, was unchanged from the previous month, after falling a revised -0.2 percent in November.
"The drop in prices continues but it is unlikely that the downtrend in prices will accelerate in the coming months," a BOJ official told reporters on Tuesday.
Contributing to the decline were financial and insurance services which edged down 0.1 percent from a month earlier to 98.4 points in December, against 100 in the 2005 base year.
Real estate services also shed 0.1 percent from November to stand at 104.5 points in December and Internet services also lost ground in December, according to the central bank's preliminary figures, retreating 0.5 percent from November to 98.3 points.
On Monday Japan's House of Representatives approved an extra budget worth 7.2 trillion yen (79.12 billion U.S. dollars) aimed at solidifying the country's still frail economic recovery.
The stimulus package, in part, aims to reverse the downward trend of business-to-business service prices, by boosting employment and providing companies with loan guarantees to expand businesses.
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