S Korea may cut 2023 GDP growth forecast on sluggish chip sales

SOUTH Korea is considering lowering its 2023 economic growth forecast to reflect sluggish performance by the semiconductor industry, Yonhap News Agency has reported.

The government may cut its projection to 1.4 per cent to 1.5 per cent from 1.6 per cent, Yonhap reported, citing finance ministry officials whom it did not identify.

South Korea has not decided when it will release its economic policy direction for the second half of the year or its detailed contents, the finance ministry said in a statement about the Yonhap report. That usually includes growth forecasts.

The Bank of Korea revised down its forecast for the year to 1.4 per cent in May from 1.6 per cent in February. Governor Rhee Chang-yong cited a downturn in the chip industry, which he said would bottom out in the fourth quarter.

The Organization for Economic Cooperation and Development and the Korea Development Institute, a state-funded think tank, predict growth of 1.5 per cent this year. BLOOMBERG