Date
2014.05.28
(SEJONG=NEWSIS) The Organisation for Economic Cooperation and Development (OECD) revised Korea’s economic growth outlook for 2014 up by 0.2 percentage points, thanks largely to economic recovery.
The OECD unveiled its Economic Outlook for 2014 on May 6. According to the report, Korea is expected to achieve a 4 and 4.2 percent growth rate for 2014 and 2015, respectively, due to an increase in exports on the back of global economic recovery.
The OECD’s growth projection for Korea rose by 0.2 percentage points to 4 percent for this year from the 3.8 percent forecast last November, and by 0.1 percentage points from the 3.9 percentage points predicted by the Korean government this year.
The revision was attributed to domestic market recovery due to an increase in investments by local companies. An expected increase in world trade volume from 2014 to 2015 and free trade deals that Korea signed with major countries were also accounted for.
Furthermore, once the government’s “Three-Year-Plan for Economic Innovation,” which focuses mainly on regulatory reform and raising the employment rate, is fully implemented, the country’s potential growth rate is expected to grow further.
But despite government efforts, unforeseen variables at home and abroad remain.
Global economic uncertainty is a primary one.
The OECD report was based on the assumption that the global economy would recover this year. But the international organization cut its global growth expectation from its November outlook, from 3.6 percent to 3.4 percent, for 2014. It kept its forecast for 2015 at 3.9 percent.
The OECD showed concern for Japan and Eurozone economies while giving the United States a high score for economic recovery.
The same applies for the domestic situation.
The Korean government forecast early this year that internal demand and exports would lead to economic growth. The government vowed to boost domestic demand, instead of depending heavily on exports, to circulate money.
But consumer confidence shrank radically in the wake of the Sewol ferry disaster.
For now, precise data on the reduction of domestic consumption is not available. But some local retailers reportedly saw sales drop by 40 percent.
Experts believe that though the adverse economic effects of the Sewol disaster may continue for a while, the economy will recover during the second half of the year.
“The Sewol ferry disaster may have a negative impact on the economy, but the economy will gain momentum in the second half of the year,” said a researcher at Nonghyup Economic Research Institute.
lst0121@newsis.com
Copyrights NEWSIS. All Rights Reserved. Source Text
Source: NEWSIS (May 6, 2014)
** This article was translated from the Korean.
The OECD unveiled its Economic Outlook for 2014 on May 6. According to the report, Korea is expected to achieve a 4 and 4.2 percent growth rate for 2014 and 2015, respectively, due to an increase in exports on the back of global economic recovery.
The OECD’s growth projection for Korea rose by 0.2 percentage points to 4 percent for this year from the 3.8 percent forecast last November, and by 0.1 percentage points from the 3.9 percentage points predicted by the Korean government this year.
The revision was attributed to domestic market recovery due to an increase in investments by local companies. An expected increase in world trade volume from 2014 to 2015 and free trade deals that Korea signed with major countries were also accounted for.
Furthermore, once the government’s “Three-Year-Plan for Economic Innovation,” which focuses mainly on regulatory reform and raising the employment rate, is fully implemented, the country’s potential growth rate is expected to grow further.
But despite government efforts, unforeseen variables at home and abroad remain.
Global economic uncertainty is a primary one.
The OECD report was based on the assumption that the global economy would recover this year. But the international organization cut its global growth expectation from its November outlook, from 3.6 percent to 3.4 percent, for 2014. It kept its forecast for 2015 at 3.9 percent.
The OECD showed concern for Japan and Eurozone economies while giving the United States a high score for economic recovery.
The same applies for the domestic situation.
The Korean government forecast early this year that internal demand and exports would lead to economic growth. The government vowed to boost domestic demand, instead of depending heavily on exports, to circulate money.
But consumer confidence shrank radically in the wake of the Sewol ferry disaster.
For now, precise data on the reduction of domestic consumption is not available. But some local retailers reportedly saw sales drop by 40 percent.
Experts believe that though the adverse economic effects of the Sewol disaster may continue for a while, the economy will recover during the second half of the year.
“The Sewol ferry disaster may have a negative impact on the economy, but the economy will gain momentum in the second half of the year,” said a researcher at Nonghyup Economic Research Institute.
lst0121@newsis.com
Copyrights NEWSIS. All Rights Reserved. Source Text
Source: NEWSIS (May 6, 2014)
** This article was translated from the Korean.