Korea (the Republic of)

This report does not constitute a rating action. Overview Institutional and economic profile Flexibility and performance profile A high-income, fast-growing economy despite security threats associated with North Korea Strong government and external balance sheets --A well-diversified and prosperous economy, with steady real economic growth, supports the sovereign ratings on Korea. --We expect the general government account to show a deficit this year and a balanced position in 2024. --Korea's economic growth will likely be stronger than that of most high-income economies in the next three to five years, amid significant global economic uncertainties. We estimate real GDP per capita will grow by an average 2.0% in 2023-2026. --Contingent liabilities associated with North Korea and the debts of government-related entities continue

...Korean economic growth will likely slow to 1.1%, from 2.6% in 2022. The slowdown mostly reflects weaker activity in the country's export sector, especially electronics manufacturers. Nevertheless, over the next three to four years, we expect that Korean economic performance will be superior to most other high-income economies. Inflation in Korea built up quickly in 2022, reflecting a global phenomenon. Higher energy prices were exacerbated by a sharp depreciation of the won. However, the headline consumer price inflation rate has retreated to a little above 4% by March 2023 after breaking 6% in mid-2022....

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