Korea’s growth potential at bottom among OECD members
Korea’s growth potential has dropped sharply to third-last among top 36 advanced economies due to its falling birthrate and rapid population aging, data showed Sunday.
Economic growth potential is the gross domestic product (GDP) growth that can be experienced without causing inflation. A failure to achieve this means the economy will have difficulty growing without triggering inflation in the future.
According to the Organization for Economic Cooperation and Development (OECD), the potential growth rate of Asia’s fourth-largest economy dropped to 2.7 percent in 2019, a 0.4 percentage points fall from 2017.
This is followed only by Turkey, whose rate dropped from 5.6 percent to 4.9 percent in the period, and Ireland with a sharper drop of 1.6 percentage points from 5.3 percent to 3.7 percent.
Eighteen other OECD members, on the other hand, saw increases, including the U.S., whose rate stood at 2 percent in 2019, up 0.1 percentage point from 2017.