The Organization for Economic Cooperation and Development (OECD) revised up its outlook for South Korea’s economic growth this year to 2.6 percent, Seoul’s finance ministry said Thursday.
The figure marked a 0.4 percentage-point increase from its projection of 2.2 percent made in February, according to the Ministry of Economy and Finance.
The forecast was rosier than the growth outlook for South Korea of 2.3 percent by the International Monetary Fund.
The South Korean government projected 2.2 percent growth and the Bank of Korea (BOK) presented a 2.1 percent forecast.
The organization said that growth is projected to strengthen following an economic “soft patch” on the back of rising exports of semiconductors.
It also said that domestic demand is forecast to recover starting the second half of this year as the central bank would likely cut interest rates, according to the ministry.
The OECD also revised up the country’s growth outlook for 2025 by 0.1 percentage point to 2.2 percent.
The revision came a
fter South Korea’s gross domestic product advanced 1.3 percent on-quarter in the January-March period, the fastest growth in more than two years, according to BOK data.
Exports gained for the seventh consecutive month in April, buoyed by strong global demand for chips.
The OECD expected inflation in South Korea to come to 2.6 percent this year before reaching 2 percent in 2025, slowing from last year’s 3.6 percent.
“The organization recommended South Korea’s push for structural reform in terms of finance, labor and pension to respond to the fast aging population,” the ministry said.
The organization also called for easing market regulations and extending support for smaller-sized companies to narrow the productivity gap between big and small firms.
As for the global economy, the OECD raised its earlier forecast by 0.2 percentage point to 3.1 percent.
It revised up the growth forecast for the United States to 2.6 percent from 2.1 percent and that for China to 4.9 percent from 4.7 percent.
The global eco
nomy has been on a gradual recovery track led by slowing inflation, employment and the improvement in conditions for global trade, according to the OECD report.
Inflation among 20 major economies is forecast to ease gradually to come to 5.9 percent in 2024 and further to 3.6 percent in 2025.
Source: Yonhap News Agency
