Korea's economy will continue to drag in 2025, economists say
Published: 02 Feb. 2025, 19:05
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- SHIN HA-NEE
- [email protected]
![A construction site for an apartment complex in Seoul on Sept. 5, 2024 [NEWS1]](https://koreajoongangdaily.joins.com/data/photo/2025/02/02/109a60b6-a06a-4eea-aec5-12ad6bbd1716.jpg)
A construction site for an apartment complex in Seoul on Sept. 5, 2024 [NEWS1]
Korean economists anticipate that the country's economy will miss the government's growth forecast this year, a survey showed Sunday.
In a survey of 100 economics professors at Korean universities conducted by the Global Research Group, the experts said the economy will likely expand 1.6 percent this year, according to the Korea Enterprises Federation (KEF).
The figure is lower than the growth outlook of 1.8 percent earlier forecast by the Finance Ministry.
The survey also showed that 64 percent of the respondents expect economic growth to be stagnant for “quite a while.”
None of those surveyed expected the economy to grow at a faster pace than the government forecast, while 35 percent said the economy will likely decline for a while and then gradually recover.
Asked about the possible impact of U.S. policy shifts under the Trump administration, 83 percent said the president's protectionist trade policies will negatively influence the Korean economy, which is highly dependent on exports.
More than 90 percent of the economists also called for measures to reform the labor market and regulations in order to boost the global competitiveness of local businesses and foster growth, according to the KEF.
The Bank of Korea (BOK) lowered its growth forecast for the country’s economy this year from its previous 1.9 percent to a range of 1.6 to 1.7 percent in a rare January projection on Jan. 20.
The central bank cited President Yoon Suk Yeol’s martial law declaration and its impact on consumer confidence for the adjustment, which came ahead of the BOK’s official outlook announcement slated for next month.
The martial law declaration, coupled with weak construction investments, pushed the country’s fourth quarter growth down to 0.1 percent, lower than initially expected 0.5 percent. This brought Korea’s real GDP expansion last year to 2 percent, underperforming the central bank's 2.2 percent November expectation.
BY YONHAP, SHIN HA-NEE [[email protected]]
with the Korea JoongAng Daily
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