Politics · South Korea · 1 hr ago
South Korea’s potential growth forecast rises for second straight year
South Korean President Lee Jae Myung welcomed a stronger growth outlook after the IMF raised its forecasts for the country.
The IMF projects potential growth of 2.14% this year and 2.20% in 2027, up from 1.94% last year.
The figures would mark the first two annual increases in about 40 years, since the late-1980s period of low oil prices, low interest rates and a strong won.
Potential growth is the pace an economy can sustain using its workers, investment and productivity without adding to inflation.
The IMF’s higher estimates reflect stronger investment in semiconductors and expected productivity gains from AI.
Lee said the government should ensure growth benefits are shared across the population.
He said it would focus on housing supply, job stability and inclusive finance, alongside projects to strengthen major industries.
The IMF raised South Korea’s potential growth forecasts to 2.14% for this year and 2.20% for 2027.
President Lee Jae Myung welcomed the outlook, calling it a dramatic rebound in the economy’s basic strength.
The two consecutive annual increases would be the first in about 40 years, according to Lee and the reports.
The IMF figures compare with an estimated potential growth rate of 1.94% last year.
The reports said stronger semiconductor investment and expected productivity gains from artificial intelligence may have contributed to the improved outlook.
- Who
- South Korean President Lee Jae Myung welcomed the revised outlook.
- What
- The IMF raised its potential growth forecasts for South Korea to 2.14% this year and 2.20% in 2027.
- When
- Lee commented on October 20, 2026.
- Where
- Lee posted his comments on X. The reports are about South Korea.
- Why
- The forecasts indicate two consecutive years of rising potential growth, the first such run in about 40 years. Semiconductor investment and expected productivity gains from artificial intelligence may have contributed.
This story does not have two clearly opposing sides.
The IMF raised its potential growth estimates for South Korea to 2.14% this year and 2.20% in 2027.
President Lee welcomed the forecasts in a post on X.
- 2025 estimate
- 1.94%
- 2026 forecast
- 2.14%
- 2027 forecast
- 2.20%
- Consecutive increases
- First in about 40 years
- Earlier two-year rise
- 1986–1987, during the period of low oil prices, low interest rates and a strong won against the U.S. dollar
3 sources
What people are saying
It marks a dramatic rebound in the South Korean economy's basic physical strength
a very positive sign