SEOUL (AP) – South Korea’s top economic think tank slashed its growth forecast for the country’s economy for the second time in four months yesterday, expressing concern about the impact of United States (US) President Donald Trump’s expanding tariffs.
The Korea Development Institute now projects South Korea’s economy to grow by 1.6 per cent in 2025, which is 0.4 percentage points lower than its previous estimate announced in November.KDI economist Kim Jiyeon said the “deterioration of the trade environment” following Trump’s inauguration was a major factor.
Domestic demand remains weak due to slowing consumer spending and a declining job market, and the pace of exports is slowing with most key industries aside from semiconductors struggling to find momentum, said Jung Kyuchul, who heads KDI’s macroeconomic analysis department. KDI could be further lower its growth projections if Trump’s trade actions intensify, Jung said.
