SEOUL– The Organization for Economic Cooperation and Development (OECD) on Wednesday revised up its 2022 growth outlook for the South Korean economy to 3 percent, citing robust exports and a recovery of private spending.
The OECD’s 2022 outlook for Asia’s fourth-largest economy was raised from its September estimate of 2.9 percent. The Paris-based organization maintained its 2021 growth projection for Korea at 4 percent. Its 2023 economic outlook for Korea came to 2.7 percent.
The OECD’s 2022 forecast is on par with the growth estimates by the Korean government and the Bank of Korea (BOK).
The OECD said South Korea’s economic growth is expected to be “stable through 2023.”
“The Korean economy continues to recover following the COVID-19 shock, propelled by strong export growth, improving business investment and public support,” the OECD said.
The outlook for Korea came even as the OECD revised down its 2021 growth forecasts for major economies, including the United States, the eurozone, China and Japan.
The South Korean economy is on a recovery track on the back of solid exports despite the latest spike in COVID-19 cases.
Asia’s fourth-largest economy grew 0.3 percent in the third quarter from three months earlier, slowing from a 0.8 percent on-quarter gain in the second quarter, according to central bank data.
Exports, which account for half of the country’s economy, grew 32.1 percent on-year to an all-time monthly high of US$60.44 billion in November. Overseas shipments extended their gains to the 13th straight month.
Meanwhile, the OECD upped its 2021 inflation outlook for Korea to 2.4 percent from its September forecast of 2.2 percent.
Its forecast is higher than the BOK’s projection in November of 2.3 percent. South Korea’s central bank aims to keep annual inflation at 2 percent over the medium term.
The OECD also raised its 2022 forecast for Korea’s inflation to 2.1 percent from its earlier estimate of 1.8 percent. The BOK’s inflation outlook for next year stands at 2 percent.
The OECD lowered its 2021 growth outlook for the global economy to 5.6 percent from 5.7 percent amid supply chain bottlenecks, rising commodity prices and a global upsurge in COVID-19 cases. Next year, the global economy is expected to grow 4.5 percent.
Source: Yonhap News Agency