IMF cuts S. Korea's growth outlook for this year to 2.8% from 3%
- 6 years ago
The International Monetary Fund is following global financial institutions in downgrading its growth outlook for South Korea.
It has cut the growth forecast this year for Korea to 2-point-8 percent.
Our Ko Roon-hee has this report.
In its World Economic Outlook report released on Tuesday, the International Monetary Fund forecast South Korea's real GDP would grow by 2-point-8 percent this year.
That's down zero-point-two percentage points from its previous projection earlier in February.
For 2019, the IMF expects Korea to grow 2-point-6 percent,… down zero-point-three percentage points from the same period.
This comes after other global financial institutions like the OECD and the Asian Development Bank downgraded Korea's growth forecast in September from its previous 3-percent to within the 2-percent range.
The IMF expects the global economy to grow by 3-point-7 percent this year… which is also down from its earlier 3-point-9 percent projection.
It said the trade spat between the U.S. and China is hurting the global economy... including South Korea.
Also, it warned that a rise in U.S. interest rates would accelerate capital flight from emerging markets.
An economic expert pointed to several reasons for the downward trend in Korea.
"It seems that the main industries like shipbuilding are continuing to face difficulties in South Korea. Also, some government policies like the minimum wage hike are increasing costs and burdens for companies. Lastly, the global trade war will negatively affect the South Korean economy, which relies heavily on exports."
Meanwhile, economic indicators released by the South Korean government increased concerns about the downturn.
Equipment investment in August fell for the sixth month in a row, dropping by one-point-four percent from the previous month.
And the number of unemployed people in August hit one-point-one-three million…which is the highest figure for the month of August since 1999.
Although the IMF didn't include specific policy recommendations for South Korea, it did say that countries need to operate monetary policy according to economic conditions and improve productivity through labor market reforms.
Ko Roon-hee, Arirang News.
It has cut the growth forecast this year for Korea to 2-point-8 percent.
Our Ko Roon-hee has this report.
In its World Economic Outlook report released on Tuesday, the International Monetary Fund forecast South Korea's real GDP would grow by 2-point-8 percent this year.
That's down zero-point-two percentage points from its previous projection earlier in February.
For 2019, the IMF expects Korea to grow 2-point-6 percent,… down zero-point-three percentage points from the same period.
This comes after other global financial institutions like the OECD and the Asian Development Bank downgraded Korea's growth forecast in September from its previous 3-percent to within the 2-percent range.
The IMF expects the global economy to grow by 3-point-7 percent this year… which is also down from its earlier 3-point-9 percent projection.
It said the trade spat between the U.S. and China is hurting the global economy... including South Korea.
Also, it warned that a rise in U.S. interest rates would accelerate capital flight from emerging markets.
An economic expert pointed to several reasons for the downward trend in Korea.
"It seems that the main industries like shipbuilding are continuing to face difficulties in South Korea. Also, some government policies like the minimum wage hike are increasing costs and burdens for companies. Lastly, the global trade war will negatively affect the South Korean economy, which relies heavily on exports."
Meanwhile, economic indicators released by the South Korean government increased concerns about the downturn.
Equipment investment in August fell for the sixth month in a row, dropping by one-point-four percent from the previous month.
And the number of unemployed people in August hit one-point-one-three million…which is the highest figure for the month of August since 1999.
Although the IMF didn't include specific policy recommendations for South Korea, it did say that countries need to operate monetary policy according to economic conditions and improve productivity through labor market reforms.
Ko Roon-hee, Arirang News.