S. Korea's economy forecast to grow 2% next year

Sinseondae Pier at Busan Port Terminal in Nam-gu, Busan, bustles with activity on Dec. 1. (Yonhap)

South Korea's economy is forecast to grow an average 2 percent next year, as it is expected to struggle with weak domestic demand in spite of a gradual recovery in exports, according to reports Sunday.

The average outlooks by 20 local and international think tanks are largely in line with the 2.1 percent growth forecast recently announced by the Bank of Korea but lower than the government's 2.4 percent projection announced in July.

The state-run Korea Development Institute and the Korea Institute for Industrial Economics have projected growth rates of 2.2 percent and 2 percent for next year, respectively. The Korea Institute of Finance has put forth a 2.1 percent growth forecast.

Growth projections by the International Monetary Fund, the Asian Development Bank and the Organization for Economic Cooperation and Development were averaged at 2.2 percent.

The three international institutions all projected for the South Korean economy to benefit from a rebound in the global chips industry and China's economic recovery, but noted potential risks involving growing household and corporate debts.

Private think tanks and securities firms, meanwhile, have released relatively lower growth outlooks.

The growth projection by five key institutions, including Hyundai Research Institute, LG Economic Research Institute and Woori Finance Research Institute, was averaged at 2 percent.

Inflation projections for South Korea by the 20 institutions, meanwhile, were averaged at 2.6 percent for 2024, in line with the 2.6 percent prediction by the central bank.