S. Korean economy forecast to grow 3.1 pct in 2009

SEOUL, Nov. 4 (Yonhap) -- South Korea's economic growth is expected to slow to 3.1 percent in 2009 from this year's estimated 4.2 percent due to anemic domestic demand, a private think tank said Tuesday.

In a gloomy report on Asia's fourth-largest economy, the Hana Institute of
Finance, a research unit of Hana Financial Group Inc., said domestic demand will
be hampered by asset deflation and falling wages in the wake of global financial
turmoil.
According to the report, the growth rate for South Korea's private consumption is
expected to drop to 1.4 percent next year from this year's 1.8 percent advance.
Exports, the main growth engine of the economy, are likely to climb 6.2 percent
on-year, compared with an expected 9.8 percent gain for this year, due to weak
overseas demand.
The nation's current account is expected to swing to a US$5.16 billion surplus
from an $8.8 billion deficit this year as cash-strapped local consumers are
likely to cut spending on imports, the institute said.
The government expects the economy to grow in the low 4-percent range next year,
but most private experts forecast the growth rate will drop to the 3-percent
range.
pbr@yna.co.kr
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