IMFC Chair: Many members talked about trade tensions increasing uncertainty

IMFC Chair: Many members talked about trade tensions increasing uncertainty

The International Monetary Fund (IMF) has significantly downgraded its growth forecast for South Korea's economy for 2025, citing heightened global economic uncertainty stemming from newly imposed U.S. tariff measures. The IMF's latest World Economic Outlook report projects a 1 percent growth rate for South Korea this year, down by 1 percentage point from its previous estimate [1].

The IMF attributes the downward revision to the swift escalation of trade tensions and extremely high levels of policy uncertainty. The U.S. tariffs have dealt a blow to South Korea's export-driven growth, exacerbating the economic conditions already strained by political instability following former President Yoon Suk Yeol's impeachment [1].

The IMF's revised forecast is more pessimistic than projections from the South Korean government and other major economic institutions. The Seoul government had earlier projected 1.8 percent growth for 2025, while the OECD and the Bank of Korea (BOK) forecasted a 1.5 percent expansion [1].

The IMF urged the international community to work collaboratively to ensure a stable and predictable trade environment, facilitate debt restructuring, and tackle shared global challenges. It also emphasized the need for countries to address domestic policy and structural imbalances to ensure internal economic stability [1].

Meanwhile, the IMF also revised its global growth forecast down to 2.8 percent for 2025, a 0.5 percentage point cut from its earlier projection [1].

References:
[1] https://en.yna.co.kr/view/AEN20250422004200320