Seoul, South Korea (4E) – Economic growth in South Korea is expected to grow at a slightly slower pace next than previously anticipated, though growth will likely pick up gradually driven by the global economic recovery and domestic policies, according to a Ministry of Strategy and Finance report released Friday.
The gross domestic product (GDP) growth forecast for 2014 was cut to 3.9 percent from a previous estimate of 4.0 percent in June, according to the ministry’s a biannual economic outlook.
The report predicts that the economy will grow at an even rate throughout the year as a result of economic stimulus in the first half as well as growth in the private sector as the global economy recovers in the second half.
This year’s GDP growth forecast has been raised to 2.8 percent from 2.7 percent in an earlier estimate.
The ministry cautioned that growth may be hampered, citing U.S. Federal Reserve bond purchases, uncertain U.S. budget policy, a subsequent slowdown in emerging economies and capital flows volatility.
Consumer prices will likely climb 2.3 percent in 2014, slower than its previous forecast of 2.8 percent in June but faster than 1.3 percent reading for this year. Inflationary pressure comes primarily from expectations of an improving economy, according to the ministry.
The South Korean economy is also expected to create 450,000 jobs in 2014, boosted by the economic rebound and job creation policies by the government, the Ministry said.