Revised Economic Forecast for 2014

  • 2014-07-09
  • 411

This report forecasts the Korean economy to grow 3.6% in 2014 on a year-on-year basis, a rate 0.6%p higher than that of 2013 (3.0%). This is because domestic demand is expected rise, albeit slowly, along with the improved export conditions driven by the continuous economic recovery trend in advanced countries. In 2015~2017, the Korean economy is expected to grow at 3.8% per year, maintaining a slightly higher growth rate than that of 2014 (3.6%). The high growth rate is predicted based on the following two reasons. First, exports are expected to be on a stronger recovery track as the global economic growth rate and trade growth rate gradually rise. Second, based on the three-year economic innovation plan pursued by the government, the foundation for domestic demand is expected to expand with an increase in R&D investment, a higher share of value added of service industries including healthcare, tourism and finance industries, the improvement of investment conditions (regulatory reform), the stable management of household debt, the enhancement of the youth and female employment rate, and reform of the public sector.

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