Korean economy of 2010 is expected to grow over 3.8%, entering a full-fledged recovery phase in the first half of the year 2010. The real GDP growth at that time will be higher than that in the second half, which partly arise from the effect of government's stimulus package including supplementary budget spending and expansionary monetary policy and partly due to the base effect of negative growth in 2009. However, the speed of the rebound in the second half is expected to be slow down due to the implementation of an exit strategy which moved from stimulus policy and appreciation of the won.
Private consumption will rise to 2.6% in 2010. As economic recovery begins in earnest, consumer sentiment will be improved gradually in line with increase in real wage and improvement in household's balance sheet. In addition, the stabilizing asset markets condition is likely to help strengthen consumer confidence.
Facilities investment is expected to rise 9.8% in 2010. As the operation rate for manufacturing sector goes back to normal level and fixes investment adjustment pressure changes its sign to plus(+), it is going to take two or three quarters to stimulate demand for facilities investments. The IT industry will lead to lead facilities investment, arising from steep increase in import of capital goods, partly in reaction to appreciation of the won against the US dollar. Construction investment growth is projected to increase 2.7% , which is mainly due to slowdown in the public sector.
Exports in 2010 are projected to post double-digit growth of 14.3% generated by gradual recovery of the global economy. Meanwhile, boosted by domestic economic recovery and rise in crude oil prices, imports would increase 19.8%. As a result, current account balance in 2010 will rapidly fall to US$14.7 billion from US$34.0 billion in 2009.
Private consumption will rise to 2.6% in 2010. As economic recovery begins in earnest, consumer sentiment will be improved gradually in line with increase in real wage and improvement in household's balance sheet. In addition, the stabilizing asset markets condition is likely to help strengthen consumer confidence.
Facilities investment is expected to rise 9.8% in 2010. As the operation rate for manufacturing sector goes back to normal level and fixes investment adjustment pressure changes its sign to plus(+), it is going to take two or three quarters to stimulate demand for facilities investments. The IT industry will lead to lead facilities investment, arising from steep increase in import of capital goods, partly in reaction to appreciation of the won against the US dollar. Construction investment growth is projected to increase 2.7% , which is mainly due to slowdown in the public sector.
Exports in 2010 are projected to post double-digit growth of 14.3% generated by gradual recovery of the global economy. Meanwhile, boosted by domestic economic recovery and rise in crude oil prices, imports would increase 19.8%. As a result, current account balance in 2010 will rapidly fall to US$14.7 billion from US$34.0 billion in 2009.