Export Boom and Second Supplementary Budget Policy Effects Reflected
Inflation Rate Forecast for This Year Revised Upward to 2.2%, Up 0.4 Percentage Points
[Asia Economy Reporter Jang Sehee] Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, stated regarding the OECD's upward revision of South Korea's growth rate this year, "It once again confirmed that our country is successfully responding to the COVID-19 crisis compared to other major countries."
On the 21st, Hong posted on his social media (SNS), "It seems that the upward revision of our country's growth rate reflects the effects of policies such as strong export performance and the second supplementary budget (supplementary budget)," he said.
The OECD revised South Korea's growth rate for this year to 4.0% in its 'Interim Economic Outlook.' This is 0.2 percentage points higher than the forecast made in May.
With this, major institutions including the International Monetary Fund (IMF) at 4.3%, the three major credit rating agencies (S&P, Moody's, Fitch) at 4.0%, and the Bank of Korea at 4.0% have all forecasted South Korea's economic growth rate to be in the 4% range this year, including the OECD.
Hong emphasized, "Comparing the average growth rates from 2020 to 2021, South Korea (1.6%) ranked third after China and Turkey, recording the highest level among advanced countries in the Group of Twenty (G20)."
He added, "South Korea is the only country among the global TOP 10 nations to have upwardly revised both this year's and next year's growth rate forecasts," and said, "It appears that positive evaluations were received not only for overcoming the crisis but also for the economy's continued recovery after the crisis."
Regarding the expanded concerns about global inflation, he said, "South Korea's inflation forecast for this year (2.2%) was also revised upward by 0.4 percentage points," adding, "If the inflation rise expands, there is a concern that difficulties in the livelihood economy, especially among vulnerable groups, may intensify, so we will pay special attention."
Meanwhile, the OECD separately announced the revised inflation forecasts for G20 countries. The inflation rate forecast for G20 countries this year was adjusted to 3.7%, up 0.2 percentage points from May. South Korea's inflation rate forecast for this year is 2.2%, which is 0.4 percentage points higher than the announcement in May.
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