Hyundai Research Institute:⁤ “Korean Economy Expected​ to Grow 2.2% Next Year”

The Hyundai Research Institute has predicted ‍that⁤ the Korean economy will grow by 2.2% next year, driven by a recovery in private ​consumption and facility investment.

According to the institute’s report, “2025 Korean Economic Outlook,” real gross ⁤domestic product (GDP) growth is expected to reach 2.2% next‍ year. However, the growth rate is ‌expected to be similar in both ‌the first and second halves of the year, with the second half benefiting from a base effect.

Private Consumption and Investment

Private consumption is expected to‌ rise ⁣by 2.0% next year, driven by improved consumer ​sentiment and employment conditions. Lower interest rates and ⁢increased ​household disposable income ‍are also ⁤expected to contribute to the growth in private consumption.

Construction investment is expected ‌to see improved conditions due to lower financing costs resulting from ⁢lower interest rates and a soft landing for‌ real estate project‌ financing (PF). However, the growth rate is expected to slow down to‍ 0.6% compared to this year due‌ to a decrease in the social overhead capital (SOC) budget and ⁤housing permits.

Exports and Facility ‌Investment

The research ‍institute projects that next year’s facility ⁣investment growth rate ‍will be 3.8%, driven ​by an improvement in the capital procurement environment. Investment sentiment may pick ⁣up, leading to a recovery in facility investment.

Exports are expected to slow down to ‌5.0% ⁤next year, compared​ to 9.2% this year, ⁣due​ to the base effect caused by the large increase this‍ year. However, the recovery in the global information and communications technology (ICT) sector is expected to⁢ contribute to the increase in exports.

Current Account Balance and Prices

The current account balance is expected to⁤ expand only slightly⁤ compared ​to this year due to the deterioration⁤ of the service balance.

Prices are expected to remain stable, rising only 2.1% ⁢next year, due to a weak domestic economic recovery ‍and stabilizing import prices as a result of the strengthening‍ of​ the won.

Unemployment⁤ Rate and Global ⁣Economy

The unemployment rate is expected to fall ​slightly to 2.7% next⁣ year, driven by increased manufacturing employment following increased⁢ exports​ and improved construction employment.

The global economy is expected to maintain a 3.0% growth trend next year, driven by improvements in​ the financial and investment environment, economic stimulus measures in major countries, and improvements in the manufacturing industry.