S. Korean economy to grow 2.3% in 2024: AMRO

The ASEAN+3 Macroeconomic Research Office (AMRO), an economic surveillance organization based in Singapore that focuses on the economies of its member countries including South Korea, China, Japan, and the ten member states of the Association of Southeast Asian Nations (ASEAN), has forecasted that the South Korean economy will grow by 2.3% in 2024. This prediction was announced by South Korea's Ministry of Economy and Finance on Monday, March 13, 2023.

The anticipated growth is attributed to a rebound in exports, which is expected to lead the overall economic expansion. The recovery of the semiconductor sector is identified as a significant contributor to the increase in exports. Semiconductors are a crucial component in various electronic devices and are a major export product for South Korea. The sector was significantly impacted by the global semiconductor shortage during the previous year, but it is now showing signs of recovery due to increased demand and production capacity expansion.

In 2023, the South Korean economy grew at a slower pace of 1.4%, according to the Ministry of Economy and Finance. This growth rate was lower than the initial projection of 2.1% due to weak domestic consumption and a decline in facility investment. However, the government and the Bank of Korea have implemented various measures to support the economy, including fiscal stimulus packages and monetary easing. These efforts are expected to contribute to the projected growth in 2024.

The global economic slowdown was another factor that affected South Korea's economic performance in 2023. The ongoing geopolitical tensions and trade disputes also had an impact on the country's exports. However, with the gradual recovery of the global economy and the improvement in semiconductor production and demand, South Korea's export-driven economy is expected to regain momentum in 2024.

In conclusion, the AMRO's forecast of a 2.3% growth rate for the South Korean economy in 2024 is based on the anticipated rebound of the semiconductor sector and the resulting increase in exports. The global economic recovery and supportive domestic policies are also contributing factors. Despite the challenges faced in the previous year, the South Korean economy is projected to bounce back and continue its growth trajectory.