Seoul:The International Monetary Fund (IMF) has adjusted its growth forecast for South Korea in 2026, predicting a rise to 3.3 percent. This increase is attributed to strong semiconductor exports, which have countered the negative impacts of ongoing conflicts in the Middle East.
According to Yonhap News Agency, the IMF's revised forecast in the World Economic Outlook report marks an increase of 0.7 percentage points from its July projection, surpassing the anticipated global growth rate of 3.1 percent. The report was published in conjunction with the 2026 Annual Meetings of the IMF and the World Bank Group, which are currently underway in Bangkok.
The IMF also anticipates that South Korea's economy will grow by 2.8 percent in 2027, a 0.3 percentage point rise from its earlier forecast. The organization highlighted South Korea and Taiwan as significant players in the AI hardware industry, suggesting that developments in these economies could influence raw material exporters and manufacturing centers globally.
Despite the positive outlook, the IMF noted that risks to the global economy, such as Middle Eastern tensions and trade fragmentation, remain, though they have diminished since July. Additional risks include commodity price fluctuations, inflation, and trade tensions. However, advancements in AI technology and changes in energy supply chains could provide positive growth momentum.
South Korea's Ministry of Finance and Economy commented that the IMF's latest forecast reflects the country's strong AI hardware and chip exports. The ministry noted this 0.7 percentage point increase is higher than the 0.4 percentage point rise for advanced economies, which have a growth forecast of 2.1 percent for 2026. Despite the positive revision, the ministry acknowledged challenges such as the ongoing Middle East conflict and rising consumer prices, which could affect household economies. The government plans to address economic disparities and enhance living standards to further support growth.
Earlier this month, the ASEAN+3 Macroeconomic Research Office (AMRO) also projected a growth rate of 3.3 percent for South Korea this year, raising its prior estimate of 3.1 percent. Additionally, the Organization for Economic Cooperation and Development (OECD) increased its growth prediction for 2026 to 3.7 percent from 2.6 percent, citing robust export performance.
South Korea's exports reached a record $120.9 billion in September, an 83.5 percent increase from the previous year, driven largely by semiconductor shipments, which exceeded $60 billion for the first time.