According to Newsis,
(Sejong = Newsis) Reporter An Ho-gyun – The International Monetary Fund (IMF) has substantially upgraded South Korea’s economic growth forecast for this year, projecting it to land in the mid-to-high 2 percent range. Powered by a booming semiconductor industry, South Korea’s economic growth for both this year and next is anticipated to be among the most robust among major advanced economies.
In its 'World Economic Outlook Update' released on the 8th, the IMF projected South Korea’s economic growth rate for this year at 2.6 percent, raising its forecast by 0.7 percentage points from the 1.9 percent projected in its April report. South Korea logged the highest upward revision margin among the 30 countries for which the IMF provided outlooks.
Furthermore, South Korea's growth forecast for next year was upgraded from 2.1 percent to 2.5 percent.
The IMF uated that the global economy is currently influenced by two conflicting currents: supply shocks stemming from the war in the Middle East and an artificial intelligence (AI)-driven technology cycle. It predicted that growth trajectories across countries will diverge depending on their exposure to the Middle East conflict and whether they are successfully integrated into the AI tech value chain.
In South Korea's case, the IMF judged that the economy would perform strongly due to its high concentration and vital role within the AI hardware value chain.
Citing South Korea as one of the top four net exporters of AI hardware (alongside Taiwan, Thailand, and Malaysia), the IMF noted that despite its high reliance on Middle Eastern energy imports, robust exports of semiconductors and AI hardware propelled South Korea's first-quarter growth rate to a seasonally adjusted annualized rate of 7.5 percent—massively outpacing the initial April forecast of 1.8 percent.
Meanwhile, the IMF downgraded its global economic growth forecast for this year from 3.1 percent to 3.0 percent. The outlooks for both advanced economies (from 1.8 percent to 1.7 percent) and emerging market and developing economies (from 3.9 percent to 3.8 percent) were lowered.
Among major countries, those seeing an upward revision in their forecasts besides South Korea included the United Kingdom (0.8 percent to 1.0 percent), China (4.4 percent to 4.6 percent), Thailand (1.5 percent to 1.9 percent), Brazil (1.9 percent to 2.4 percent), and South Africa (1.0 percent to 1.1 percent).
On the other hand, nations such as the United States (remaining at 2.3 percent), Germany (0.8 percent to 0.7 percent), France (0.9 percent to 0.6 percent), Italy (remaining at 0.5 percent), Spain (remaining at 2.1 percent), Japan (0.7 percent to 0.6 percent), Canada (1.5 percent to 1.1 percent), Australia (2.0 percent to 1.9 percent), India (6.5 percent to 6.4 percent), Russia (remaining at 1.1 percent), Mexico (1.6 percent to 1.2 percent), and Saudi Arabia (3.1 percent to 1.7 percent) either saw their forecasts drop or remain unchanged.
However, the IMF raised its global economic growth forecast for next year from 3.2 percent to 3.4 percent, upgrading projections for both advanced economies (1.7 percent to 1.8 percent) and emerging market and developing economies (4.2 percent to 4.5 percent).
The IMF analyzed that global economic risks are more balanced than during its April assessment, yet downside factors still prevail. It noted the need to remain vigilant against risks such as geo-economic uncertainties in the Middle East, trade fragmentation, and weakened policy buffers in certain countries.
Regarding AI, the IMF uated that while it could contribute to growth by enhancing efficiency, a sudden reversal in market expectations could act as a downside factor that dampens consumption and financial markets.
Concurrently, the IMF advised monetary policy to prioritize price stability, while recommending that fiscal support should be temporary and targeted, centering primarily on vulnerable social groups. It also called for international cooperation to restore global trade norms alongside structural reforms to strengthen energy security and AI responsiveness.
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Source Text
Source: Newsis (July 08, 2026)
** This article was translated from Korean.