Economists take a pessimistic view of Korea's prospects this year as the eurozone crisis drags on and the U.S. recovery stalls while China's economic growth is cooling down. Amid all these negative factors, Korea's domestic consumption is also showing clear signs of slowing down.

"External conditions are still uncertain," said Yoo Byung-kyu at the Hyundai Economic Research Institute. "We fear that both exports and domestic consumption are shrinking. Lee Eun-mi at the Samsung Economic Research Institute explained that consumption is determined by four variables -- jobs, income, debt and consumer prices -- and all four are looking bad. "Amid a lackluster domestic economy, the labor market is sluggish without generating stable jobs, while household debts continue to rise as consumer prices remain high, though price increases tapered off a bit from last year," Lee added.

Bae Min-keun at the LG Economic Research Institute attributed weak consumer spending to deleveraging, i.e. attempts to reduce debt. "Strengthened efforts by financial authorities since late last year to lower household debt are crimping consumer spending," Bae said. "Unless the household debt problem is solved, consumer spending will continue to be weak."

Consumer spending used to account for 60 percent of the Korean economy but sank to the 50 percent level in 2011, according to Lee Joon-hyup at the Hyundai Economic Research Institute. "It could fall below 50 percent this year," Lee added.

Although the eurozone crisis has calmed down temporarily, many economists expect a bumpy ride for the Korean economy in the second half of this year.

"We could see risks become reality in the second half in Europe and the U.S., including fizzling economies and abrupt fiscal spending cuts," said Lee Jae-woo at Bank of America. "In that case, not only will Korean exports take a direct blow, but consumer spending will be affected negatively as well.

The Ministry of Strategy and Finance says the threat of a slowing economy is more serious than expected and has lowered its growth forecast for the year from 3.7 percent to 3.5 percent in April and it again revised it to 3 percent on Friday.