APD | S. Korea's economy forecast to expand 2.3% next year

By APD writer Alice

The state-run Korea Development Institute (KDI) on November 13 predicted that South Korea's economy will grow 2.3 percent in 2020, slightly higher than this year's estimated 2 percent expansion, thanks to improvements in domestic demand and exports.

In its report, KDI said the local economic growth could be 2.3 percent next year from 2 percent this year if the global economy rebounds to 3.4 percent from 3 percent, noting that the global economy could only grow in 2020 unless the trade dispute between the United States and China further worsens.

According to South Korean Finance Minister Hong Nam-ki, the government will make efforts to achieve an economic growth of more than 2.3 percent next year.

The South Korean government is set to release its 2020 growth outlook in mid-December, he added.

KDI lowered its growth outlook for this year to 2 percent from its previous forecast of 2.4 percent due to weak investments and a slowdown in the manufacturing sector as well as the trade dispute between the US and China -- Seoul's two largest trade partners.

Last year, South Korea's exports to China and the US accounted for 26.8 percent and 12 percent, respectively, of its total outbound shipments.

KDI also predicted that the country’s exports will decline 9.6 percent this year before going up 4 percent in 2020.

Earlier, in September, the Organization for Economic Cooperation and Development (OECD) also said the number four economy in Asia could expand 2.3 percent in 2020, slower than its May forecast of 2.5 percent.

The International Monetary Fund (IMF) recently revised down South Korea's economic growth outlook to 2.2 percent for 2020 from the 2.8 percent expansion projected in April, citing lingering uncertainties in global markets.

(ASIA PACIFIC DAILY)