OECD maintains growth outlook for Korea at 3%

The Organization for Economic Cooperation and Development (OECD) raised its growth outlook for the global economy on Tuesday but held its forecast for Korea at 3 percent.

The OECD expects the world economy to expand 3.7 percent this year, up from its previous estimate of 3.9 percent. The growth forecast for next year was raised from 3.6 percent to 3.9 percent.

The report cited a positive outlook in advanced economies including the United States and Germany, where tax reform and government spending have increased.

The OECD raised its growth projection for the United States from 2.5 percent to 2.9 percent. The estimate for next year was raised from 2.1 percent to 2.8 percent.

The European Union’s growth outlook was raised from 2.1 percent to 2.3 percent for this year and 1.9 percent to 2.1 percent for next year.

For Korea, the OECD said recovering global trade and government policies, including a higher minimum wage and larger welfare spending, will contribute to its growth but maintained its forecast at 3 percent for this year and next year.

The organization raised concerns about intensifying trade protectionism as well as tighter monetary policies, demographic changes and falling mid to long-term investment and productivity.

By Lee Ho-jeong