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Korea Economic Snapshot

Economic Forecast Summary (May 2021)

Real GDP is projected to increase by 3.8% and 2.8% in 2021 and 2022, respectively. Strong export growth, rising investment and expansionary macroeconomic policy are boosting the economy. Distancing measures have contained the COVID-19 virus spread, but weigh on large parts of the service sector, which keeps unemployment and the household saving ratio relatively high. When those restrictions can be lifted, the economy will gather momentum.

Reform Priorities (April 2021)

Going for Growth 2021 - Korea

The pandemic highlighted vulnerabilities of the dual labour market and a weak social safety net. A welfare reform needs to be coupled with policies aimed at increasing employment and job quality, especially for women and older workers, who are often in non-regular jobs and the most affected by the crisis. A more flexible labour market would allow workers to move more easily from crisis-hit sectors to growing industries.

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2021 Structural Reform Priorities

  • Social protection: Strengthen the social safety net and improve the efficiency of the tax system
  • Labour market: Reform employment protection legislation
  • Labour market: Strengthen policies to support employment of women and older persons
  • Competition and regulation: Reduce the regulatory burden on economic activity
  • Environmental policy: Strengthen environmental regulations and price signals

 

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Economic Survey of Korea 2020

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