(LEAD) S. Korean economy to grow 5 pct from 2011-2013: minister

(ATTN: ADDS more comments on fiscal status in last para)
SEOUL, Oct. 12 (Yonhap) -- South Korea's top economic policymaker said Monday
that the nation will be able to achieve its mid-term growth projection of around
5 percent, dismissing concerns that the government is painting too optimistic a
view of economic conditions down the road.

"We based the forecast on (factual) grounds and made it with confidence," Finance
Minister Yoon Jeung-hyun told lawmakers during an annual parliamentary audit.
"Even the IMF and the OECD make similar projections for our economy, showing that
our outlook is based on an objective assessment, not on figures resulting from
armchair discussion."
The finance ministry earlier said that it will be able to achieve a 5-percent
expansion between 2011 and 2013. The projection is in line with the nation's
mid-term potential growth rate and is also higher than this year's negative 1.5
percent and plus 4 percent for next year.
South Korea's economy is showing signs of a faster-than-expected recovery as the
government-led stimulus measures seemed to help the country weather a steep
downturn caused by financial turbulence and resulting global recession last year.
In a report submitted for the audit, the ministry expected the Korean economy
will likely continue its improving trend in line with rebounding global economic
conditions, though there are still lingering downside risks such as rising crude
oil prices.
The ministry confirmed that it will maintain its expansionary macroeconomic
policy stance "for the time being" until the economy is seen to be making a
firmer recovery.
The remarks comes as South Korea's central bank recently kept its key interest
rate unchanged at a record low of 2 percent, dispelling speculation that it could
soon raise borrowing costs to stabilize property prices.
With increasing concerns over worsening fiscal soundness and a possible bubble in
the asset market, debate has been brewing over when and how to seek the so-called
exit strategy intended to withdraw emergency stimulus measures introduced by the
government and the central bank to ease an economic downturn.
During the audit, Yoon told lawmakers that the nation's fiscal status remains in
relatively better shape than many other countries, though debts inevitably
mounted in the face of an "unprecedented" economic crisis but added that the
government will make efforts to achieve a balanced budget by its target year of
2013-2014.
kokobj@yna.co.kr
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