Seoul - Saba:
The Asian Development Bank (ADB) sharply lowered its growth forecast for South Korea’s economy this year 2025 to 0.8 percent.
The South Korean Ministry of Finance said today, Wednesday, citing the latest report issued by the Manila-based bank, that this latest forecast represents a decrease of 0.7 percentage points compared to the bank’s previous forecast issued last April.
The revised forecasts are more pessimistic than those of other major institutions. The Organisation for Economic Co-operation and Development (OECD) and the International Monetary Fund (IMF) had forecast growth of 1 percent, while the Bank of Korea expected growth of 0.8 percent.
This downgrade is attributed to several factors, including a decline in investment in the construction sector, slowing exports, and continued weakness in the local real estate market.
The Asian Development Bank also warned of the possibility of further export contraction due to U.S. tariff measures and increasing trade uncertainty.
However, the bank pointed out that domestic demand is expected to recover in the second half of the year, supported by expansionary fiscal policy and the resolution of political uncertainty following the presidential elections last June.
| more of (International) |