Warning “threatening the soundness of 1,000 trillion household debt”
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The International Monetary Fund (IMF) adjusted its forecast for Korea’s economic growth this year to 3.6%, 0.5 percentage points higher than two months ago. This is far higher than the OECD’s estimate of 3.3% this year and the Bank of Korea’s 3.0%.
The Ministry of Strategy and Finance explained that in the annual consultation report released by the IMF on the 26th, it has raised the forecast for Korea’s growth rate to 3.6%, reflecting the global economic recovery, export and investment growth, and an additional budget of 15 trillion won. It has increased by 0.5 percentage points in two months since the outlook (3.1%) from the World Economic Outlook (WEO) in January. The IMF said, “When the report was written, it was estimated at 3.4%, but it was raised to 3.6% in light of the supplementary estimates announced later.”
The IMF also advised that the screening support for the victims of the novel coronavirus infection (Corona 19) should be increased through financial expansion. In the short term, it was recommended to maintain an expanding fiscal policy while continuing to support liquidity for companies, but to monitor the implementation of fiscal rules through an independent committee.
The IMF also emphasized that it is necessary to prepare sound measures for household debt, which has exceeded 1,000 trillion won, and to closely observe the impact of household debt on the real estate market.
/ Sejong = Reporter Woo Young-tak [email protected]
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