📊Executive Summary

The Korea Development Institute (KDI) has revised its economic growth forecast for South Korea, increasing it from 0.8% to 0.9% for this year, primarily due to a stronger-than-expected semiconductor market. The KDI anticipates that this positive trend in the semiconductor sector will continue into next year, raising the growth forecast from 1.6% to 1.8%. Despite challenges such as increased tariffs affecting exports to the U.S. and sluggish domestic demand, the semiconductor industry's robust performance, particularly in exports to Asia, has helped maintain a positive trade balance. The KDI also noted that government fiscal policies are supportive of this growth, contributing to an expected gradual improvement in domestic consumption and employment conditions. However, risks remain, including uncertainties related to trade agreements and potential inflationary pressures from currency fluctuations....