Korean economy this year could do better than expected: fin min

Korea’s finance minister and deputy prime minister Yoo Il-ho attends the G 20 Finance Ministers meeting and the International Monetary and Financial Committee (IMFC) meeting held in Washington. [photo by the Ministry of Strategy and Finance]

Given the pace of pickup in the economy led by overseas demand, the South Korean economy may grow faster than estimated 2.6 percent this year and won’t require an extra budgeting by the incoming administration, said Yoo Il-ho, deputy prime minister for the economy.

“Exports are fueling recovery, and the trend may likely continue,” Yoo told reporters on Saturday in local time in Washington where he is visiting for the Group of 20’s Finance Ministers’ meeting and the International Monetary and Financial Committee (IMFC) meeting.

“I think it is matter of time before domestic consumption would recover if exports do better,” Yoo said. But the external performance would hinge on U.S. factors, he added.

The Korean economy would be largely affected by the U.S. Federal Reserve’s increases in interest rates. U.S. Vice President Mike Pence during a recent visit to Seoul said his administration will review and reform the five-year-old free trade agreement with Korea. The U.S. Commerce Department in June will release its overview on trade strategy and specify the trade action plan of the Trump administration.

Yoo said Washington won’t revisit the bilateral free trade pact in near future. The U.S. would first focus on the review of the North American Free Trade Agreement (NAFTA) and trade issues with China, which would take at least a year.

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Korea’s finance minister and deputy prime minister Yoo Il-ho attends the G 20 Finance Ministers meeting and the International Monetary and Financial Committee (IMFC) meeting held in Washington. [photo by the Ministry of Strategy and Finance]

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