South Korea's economic growth outlook for 2020

2020년 한국경제, 수출회복에 완만한 개선 기대

The global economy is expected to improve slightly this year thanks to fewer uncertainties and faster growth in emerging economies.
For an economic outlook of South Korea's economy for 2020, here's our business correspondent Kim Hyesung.
The South Korean government expects the local economy to post growth of two-point-four percent in 2020, up from last year's two percent.
Other economic research institutes and banks forecast a range of between 1-point-seven and two-point-three percent, with an increase in exports and investment.
South Korea's exports are expected to rebound on a base effect and faster global trade, which the WTO expects to double to near three percent growth.
In particular, semiconductor exports are expected to go up on demand from global data centers and 5G-related technologies, providing a boost for Korean tech giants like Samsung Electronics and SK Hynix.
The auto sector, which accounts for about a tenth of Korea's manufacturing jobs, will remain sluggish on weak global demand and ongoing restructuring efforts.
"Overall, the outlook for chips, shipbuilding and secondary batteries looks positive while others are expected recover slightly or decline. Demand for secondary batteries is expected to continue increasing on IT sector demand, including driverless cars. As for the steel, petrochemical and display sectors, they will face even fiercer competition from China, resulting in sluggish exports."
On top of continuing with its expansionary fiscal policy, Seoul's finance ministry has vowed to invest a total of 86 billion U.S. dollars in public and private investment and announced a series of policies including a consumption tax cut for some car buyers to help boost domestic consumption.
While the domestic and global economic outlooks for 2020 are expected to be better than 2019, the U.S.-China trade tensions and Brexit remain as downside risks.
"To tackle the three lows facing the country, namely lower interest rates, lower prices and lower potential economic growth, the keys for the Korean economy in 2020 will be to increase investment and nurture new industries by easing government regulations, to lift consumer sentiment and to diversify trade as a way to hedge uncertainties and support growth."
Kim Hyesung, Arirang News.

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