hankyoreh

.

The Organization for Economic Cooperation and Development (OECD) has revised its forecast for South Korea’s economic growth rate this year to -1.1%, down from -1.0% this past September. Despite that, the OECD said that South Korea’s effective containment of COVID-19 had enabled it to defend its growth rate better than any other member state.

According to the OECD Economic Outlook, published on Dec. 1, South Korea will have an economic growth rate of -1.1% this year. This was higher than any other OECD country, just as in September. Among G20 countries, Korea’s rate was second only to China’s (1.8%).

The OECD predicted that the Korean economy would grow by 2.8% next year, down 0.3 points from September (3.1%), and by 3.4% in 2022. The OECD’s downward revision is thought to account for the contraction of economic activity resulting from tougher social distancing rules following fresh outbreaks of the coronavirus in August and November.

Korea’s “effective measures to contain the spread of COVID-19 have limited the estimated fall in GDP to just over 1% in 2020, the smallest decline in the OECD,” the organization said in its report. It noted that major fiscal support from the government had propped up consumption and that semiconductors drove a recovery in exports, while jobs fell.

The OECD report added that Korea is expected to see an average of 3% in annual growth in 2021 and 2022. But given the high level of uncertainty, the OECD advised Korea to support households and companies, focusing on weak sectors such as irregular workers and the service sector, until the recovery is consolidated.

The OECD predicted that the global economy would shrink by 4.2% this year and grow by 4.2% next year. According to its forecast, the US and China will see respective growth rates of -3.7% and 1.8% this year and 3.2% and 8.0% next year.

“The global economy will gain momentum over the coming two years, with global GDP at pre-pandemic levels by the end of 2021,” said Laurence Boone, the OECD’s chief economist.

By Lee Jeong-hun, staff reporter

Please direct comments or questions to [english@hani.co.kr]