SEOUL, May 13 (Xinhua) — South Korea’s state-run think tank on Thursday raised its 2021 growth outlook for the economy to 3.8 percent to reflect the recently-announced positive economic indicators.
The Korea Development Institute (KDI) forecast that the economy would expand 3.8 percent this year, up from a growth forecast of 3.1 percent estimated six months earlier.
It was higher than 3.6 percent estimated by the International Monetary Fund (IMF), 3.3 percent by the Organization for Economic Cooperation and Development (OECD) and 3.5 percent by the Asian Development Bank (ADB).
The KDI said the South Korean economy has gradually recovered after hitting the bottom in the second quarter of last year, noting that the economy’s growth path will depend on the COVID-19 pandemic and the vaccine rollout.
The country’s real gross domestic product (GDP), adjusted for inflation, increased 1.6 percent in the January-March quarter from the previous quarter, recovering to a pre-pandemic level.
Following the GDP announcement, the Korea Institute of Finance revised up its growth outlook to 4.1 percent. The government vowed to make all-out efforts to achieve the growth rate of over 4 percent this year.
Export, which accounts for about half of the South Korean economy, surged 41.1 percent in April from a year earlier, marking the fastest expansion in over 10 years.
The KDI estimated this year’s consumer price inflation at 1.7 percent, up from an outlook of 0.7 percent six months ago. It was attributed to higher price for global crude oil.
This year’s growth forecast for export was upgraded from 3.1 percent to 8.6 percent, and the outlook for consumer spending was revised up from 2.4 percent to 2.5 percent.
Facility investment and investment in the construction sector were expected to expand 8.5 percent and 1.4 percent respectively in 2021. Enditem