The International Monetary Fund on Tuesday lowered its growth forecast for South Korea's economy this year to 2 percent from its previous outlook of 2.6 percent amid a global economic slowdown.
Slowing growth in China and the "spillover" of the yearlong trade war between the United States and China have affected the IMF's downward revision of a growth outlook for Asia's "developed" countries, such as South Korea, Hong Kong and Singapore this year, the IMF said.
The IMF also revised down South Korea's gross domestic product growth to 2.2 percent for 2020 from 2.8 percent projected in April, citing lingering uncertainties in global markets.
The downward revision came amid concerns in Asia's fourth-largest economy.
Finance Minister Hong Nam-ki recently told lawmakers that South Korea appears unlikely to achieve its 2.4 percent growth target, but he said the government has no plan to revise down its economic forecast.
In July, South Korea slashed its economic growth outlook for this year to between 2.4 percent and 2.5 percent from its previous forecast of between 2.6 percent and 2.7 percent, made in December, citing weak exports and sluggish investment.
South Korea's exports fell 11.7 percent on-year to US$44.7 billion in September, extending their on-year decline to a 10th consecutive month due to weak prices of semiconductors and the yearlong trade row between the United States and China.
Outbound shipments of chips declined 31.5 percent on-year to $8.5 billion in September, dealing a blow to South Korea, as semiconductors account for one-fifth of its exports.
The global economy is forecast to grow 3 percent this year, down from an earlier outlook of 3.3 percent, the IMF said, also lowering a global growth outlook for 2020 to 2.2 percent from 2.8 percent.
The 3 percent growth projection marks the lowest level since the global economy contracted a 0.1 percent in 2009 following the 2007-2008 global financial crisis, the ministry said.
Next year, emerging countries, such as Brazil, Mexico and Russia, are expected to recover from an economic downturn this year. But uncertainties surrounding emerging markets and possible slowdowns in the U.S. and China will remain downside factors, it said. (Yonhap)
Cho kyung-hee email@example.com