Seoul: A regional macroeconomic research agency has projected South Korea's economy to grow 1.6 percent in 2025, citing uncertainties in global trade due to escalating U.S. protectionist measures.
According to Yonhap News Agency, the ASEAN+3 Macroeconomic Research Office (AMRO) released its latest regional outlook report, which includes growth and inflation forecasts for the ASEAN+3 region. This region consists of the 10 member states of the Association of Southeast Asian Nations (ASEAN), as well as South Korea, China, and Japan.
AMRO's growth outlook for South Korea, Asia's fourth-largest economy, is slightly more optimistic than the 1.5 percent forecasts by the Organization for Economic Cooperation and Development (OECD) and the Bank of Korea (BOK). It is, however, on par with the Korea Development Institute's projection.
The agency warned of increased downside risks, noting that the U.S.' strengthened protectionist policies could dampen regional growth by disrupting global trade flows.
AMRO also highlighted tightening global financial conditions, a slowdown in major economies, and surging commodity prices as short-term headwinds. Over the longer term, the agency identified population aging, climate change, and technological disruptions as key structural challenges for the region.
Inflation in South Korea is expected to remain stable at 1.9 percent in 2025, supported by steady domestic food prices and declining global energy costs, the agency stated. The assessment was based on policy consultations conducted with South Korean officials in November last year.