ADMIN 2019. 06. 18.
 Gloomier Outlook for 2005
글쓴이: GMG  날짜: 2004.08.06. 11:02:38   조회: 2914   글쓴이IP:
A private think tank on Thursday forecast the economic situation will worsen next year, projecting 3.7 percent growth for gross domestic product (GDP) for 2005.

In a report on the prospects for economic growth in the latter part of 2004 and 2005, the Samsung Economic Research Institute (SERI) predicted the GDP growth rate will drop to 4.6 percent in the second half of the year, having recorded 5.4 percent in the first half.

As a result, SERI’s economic growth projection for 2004 was also adjusted downward to 5 percent from its original figure of 5.3 percent, which was made in April.

The adjusted GDP projection for 2004 is lower than the government projection of 5.2 percent, indicating that sentiment concerning the economic situation is worse on the private level.

One of the key reasons for the pessimistic outlook for next year is the expected fall in export growth for the second half of the year, the report said.

It added that the rate of export growth, which stayed above 30 percent in the first and second quarters of the year, is expected to slow in the third quarter and plummet to 15 percent in the fourth in line with dwindling overseas demand for Korean goods.

The export outlook for next year suggests a greater decline, with the export growth rate falling to 7.5 percent under the influence of an expected slowdown in the global information and technology industry.

The growth of fixed investment is expected to fall from 3.0 percent this year to 2.7 percent next year.

These negative factors will lead the GDP growth rate to drop to 3.7 percent in 2005, the SERI report said.

It warned that Asia’s third largest economy could fall into a decade-long depression unless it finds new growth engines and establishes social and political stability.

According to the report, boosting slowed consumption is the most important task ahead for the government. For this, SERI proposed tax cuts to promote consumption, rather than the expansion of government spending.

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