The International Monetary Fund (IMF) explained on the 13th (local time) that Korea’s economic growth rate has been lowered one following another this year due to deteriorating semiconductor industry conditions and slowing domestic demand.
Krishna Srinivasan, director of Asia Pacific at the IMF, said at a press conference by region at the IMF/World Bank Spring Meeting held in Washington, DC, that Korea’s growth rate was lowered by reflecting various factors. business cycle).”
He analyzed that the semiconductor cycle affects both exports and investments in Korea, a major country in the semiconductor market.
He also cited a slowdown in consumption, austerity measures and adjustments in the housing market following the surge in COVID-19, and said, “All of these are affecting consumption, making (Korea’s) domestic demand weaker than in the past.”
Previously, in the World Economic Outlook (WEO) announced on the 11th, the IMF predicted Korea’s economic growth this year at 1.5%, which was lowered from 2.9% in July last year to 2.1%, followed by 2.0% in October last year and this year. This is the fourth consecutive downward revision following January (1.7%).
However, Director Srinivasan predicted that in the second half of this year, demand will increase in China, which has lifted the COVID-19 blockade, and will have a positive impact on the Korean economy.
He forecast China’s economy will grow 5.2 per cent this year following a strong recovery following the lifting of lockdown.
China’s rising demand for consumer goods will benefit neighboring countries, especially those that trade a lot with China, and expected that the economic growth rate of other countries will increase by an average of 0.6 percentage points due to the effect of China’s consumption rebound.
The growth rate for the Asia-Pacific region as a whole was projected to be 4.6%, 0.3 percentage point higher than last October.
Srinivasan said, “The upward adjustment has a large impact on China’s lifting of the lockdown,” adding, “The Asia-Pacific region will account for more than 70% of global growth this year.”
(Photo = Yonhap News)
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