OECD maintains Korea’s 2023 growth forecast at 1.5%

The Organization for Economic Cooperation and Development (OECD) projected South Korea’s economy to grow 1.5 percent this year, unchanged from its previous forecast in June, which is higher than the forecasts of the Asian Development Bank (ADB) and International Monetary Fund (IMF).

According to the Ministry of Economy and Finance on Tuesday, the OECD in its interim outlook report projected Korea’s economy to grow 1.5 percent this year and 2.1 percent next year.

The growth forecast for this year is higher than those by the ADB (1.3 percent), Korean government (1.4 percent), Bank of Korea (1.4 percent), and IMF (1.4 percent). It is the same as the forecast by KDI.

The OECD projected Korea’s inflation at 3.4 percent for this year and 2.6 percent for next year, unchanged from its previous forecast.

When it comes to the global economy, the OECD projected a 3 percent growth for this year, up 0.3 percentage point from its previous forecast of 2.7 percent in June.

By country, the OECD raised the growth outlook for Japan for this year to 1.8 percent from 1.3 percent. It, however, projected Japan’s economy to expand 1 percent next year, down from the previous forecast of 1.1 percent.

China‘s growth rate for this year has been adjusted downward by 0.3 percentage point to 5.1 percent and for next year by 0.5 percentage point to 4.6 percent.

China’s inflation rate for this year has been revised down by 1.6 percentage points to 0.5 percent from the previous forecast of 2.1 percent, and for next year, the figure has been lowered by 0.7 percentage point to 1.3 percent.

“The global economy proved more resilient than expected in the first half of 2023, but the growth outlook remains weak,” the OECD said. “With monetary policy becoming increasingly visible and a weaker-than-expected recovery in China, global growth in 2024 is projected to be lower than in 2023.”