S. Korean economy forecast to grow 3.9 pct next year: think tank

SEOUL, Oct. 26 (Yonhap) -- The South Korean economy is expected to grow 3.9 percent next year, a sharp fall from this year's estimated 4.3-percent gain, due to slumping exports and weak domestic spending, a local research center said Sunday.

According to Hyundai Economic Research, Asia's fourth-largest economy is forecast
to grow 3.2 percent in the first half of next year and 4.7 percent in the second
half.
"The economy is expected to remain in a slump in the first half of next year on
weak domestic and overseas demand," the research center said. "But in the second
half, economy-boosting measures will work to spur the economy, and mortgage
problems in the United States will be resolved to some degree."
Government sources also have said that this year's economic growth may fall to
the mid-4-percent range from an earlier target of 6 percent, with some private
think tanks forecasting the GDP to slow to the mid-3-percent level in 2009.
The country's central bank said Friday that the economy grew at the slowest pace
in four years in the third quarter due to sluggish domestic demand and lagging
export growth.
The economy expanded 0.6 percent on-quarter in the July-September period, the
lowest figure since the 0.5 percent-growth in the third quarter of 2004,
according to the Bank of Korea.
Earlier this month, BOK Gov. Lee Seong-tae said the country's economy is expected
to grow slower next year amid difficulties at home and abroad expanding at the 4
percent-range rate until the first half of next year.
The research institute forecast that the country's inflation will ease to 3.9
percent from this year's estimated 4.7 percent on falling prices of commodities
such as crude oil.
sam@yna.co.kr
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