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OECD, IMF projects rosier 2026 for Korean economy

Published: 02 Dec. 2025, 19:00

YOON SO-YEON
[email protected]

Export containers are stacked at Pyeongtaek Port in Gyeonggi on Nov. 14. [YONHAP]

Global economic organizations project that 2026 will be rosier for the Korean economy as eased tensions in the international market and revived consumer sentiment mark a recovery in export trade and domestic consumption.

The Organisation for Economic Cooperation and Development (OECD) and the International Monetary Fund (IMF) both announced their forecasts for the 2026 economy on Tuesday. The IMF report was announced at the “Buffered Slowdown amid an Asymmetrical World” conference, held jointly with the Korea Institute for International Economic Policy (KIEP).

While the OECD forecasts a steady 2.1 percent growth for Korea's GDP for the upcoming year, the IMF expects a 1.8 percent growth in 2026 — both double their figures for 2025, when the OECD projected an increase of 1 percent, and the IMF 0.9.

“Private consumption is supported by fiscal and monetary easing and rising real wages,” the OECD wrote in its December report.

“Employment will continue to expand, largely due to the increased labor market participation of women and older workers. Exports will support growth in the short term, despite increased tariffs, but are expected to slow in the medium term. Growth could be higher than projected if households consume a larger share of their rising income and public transfers than assumed.”

This 2.1 percent, however, is 0.1 percentage points lower than the 2.2 percent figure presented earlier this year in June and September. The OECD also lowered its outlook on 2026 consumer inflation from 2 percent in June to 1.9 percent in September and 2.8 percent in the latest report.

The Korea Institute for International Economic Policy holds a joint conference, titled ″Buffered Slowdown amid an Asymmetric World,″ with the International Monetary Fund at the Novotel Ambassador Seoul in Gangnam, southern Seoul, on Nov. 2.

Although the OECD did not elaborate on why it had reduced its projection, the organization noted that “uncertainty over tariff negotiations and structural shifts in global supply chains could weigh more heavily on exports and dampen business investment.”

“Further monetary policy loosening is warranted, considering weak domestic demand. Aging will exert considerable future spending pressures. Spending plans should therefore be followed by a bipartisan commitment to putting public finances on a sustainable path,” noted the report.

The IMF also presented a more robust outlook for Korea, with a 1.8-percent GDP growth expected for next year. However, this falls short of the expected 3 percent growth for the global economy, and different countries must tailor their own policies to adapt to changes in the upcoming year, according to Lee Si-wook, the president of the KIEP.

The KIEP has held an annual conference with the IMF since 2011.

BY YOON SO-YEON [[email protected]]