Local think tank lowers 2023 growth projection for S. Korea to 1.8 pct

SEOUL– A local think tank on Thursday projected South Korea’s economy will grow 1.8 percent this year, downgrading its earlier forecast as global recession worries mount and domestic demand is expected to dwindle amid high inflation and interest rates.

Hyundai Research Institute said in a report it has revised down its growth projection for South Korea to 1.8 percent for 2023 from a 2.2 percent gain it predicted in September last year.

It expected the economy will grow 1.6 percent on-year in the first half before expanding 2 percent in the latter half.

The think tank cited as reasons for the revision downside risks on exports from growing worries over a global recession, and a fall in spending and corporate investment on the domestic front throughout this year.

It also voiced worries over monetary policy tightening in major countries and the fallout from the ongoing Russia-Ukraine war, which could undercut trading and cause global economic growth to weaken.

The latest projection was slightly higher than the Bank of Korea’s forecast of a 1.7 percent advance predicted in November. The central bank recently hinted growth could slow below the November projection.

In December, the finance ministry predicted the economy will grow 1.6 percent this year.

Source: Yonhap News Agency

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