OECD lowers economic forecast amid slowing growth

By Bae Hyunjung
  • Published : Mar 6, 2019 - 19:01
  • Updated : Mar 6, 2019 - 19:01

The Organization for Economic Cooperation and Development on Wednesday inched down its forecast for the global economy, as well as for the South Korean economy, citing slowing trades, weakened growth and other downside risks.

In its half-year interim outlook report, the OECD lowered the global economic growth forecast for 2019 to 3.3 percent from the 3.5 percent previously suggested in the November report, the Ministry of Economy and Finance said. The outlook for 2020 was also reduced to 3.4 percent from 3.5 percent.

The key reason for the pessimistic approach, according to the ministry, was the weak growth trend in China and in the Eurozone, as well as the global slowdown amid trade tensions.

The outlook for Eurozone dropped 0.8 percentage point to 1 percent for 2019, reflecting the uncertainties related to Brexit and worsening economic sentiment, data showed.

The outlook for South Korea’s growth for 2019 and 2020 were both set at 2.6 percent, down 0.2 percentage point and 0.3 percentage point respectively from previous figures. The given figures, despite the downward adjustment, remained in the Seoul government’s latest outlooks of 2.6-2.7 percent.

“Expansive government spending and low inflation are expected to shore domestic demands (throughout this year and next year),” the ministry quoted the OECD report as saying.

By Bae Hyun-jung (