The Organization for Economic Cooperation and Development (OECD) has lowered its economic growth forecast for South Korea to 1.7 percent for this year, citing ongoing tensions in the Middle East, according to the South Korean Ministry of Economy and Finance.
This revised forecast marks a 0.4 percentage point reduction from the OECD’s earlier projection of 2.1 percent growth, which was released in December, the ministry stated.
Highlighting the escalating conflict in the Middle East, the OECD cautioned that 2026 will “test the resilience of the global economy,” suggesting potential challenges to global stability.
The ministry emphasized South Korea’s significant reliance on energy imports from the Middle East compared to other Group of 20 (G20) countries, attributing this dependence as a key factor in the downward revision of the growth forecast.
This updated outlook presents a more conservative view compared to the International Monetary Fund (IMF) and the Korea Development Institute (KDI), both projecting a 1.9 percent growth rate for South Korea this year. The Bank of Korea (BOK) forecasts a slightly higher growth rate of 2 percent.
