Solemn Mood After Ferry Disaster to Cut Growth Rate

      May 09, 2014 11:41

      Noticeably shrinking consumer spending since the ferry disaster off the southwest coast could lead to a drop in Korea's growth rate of 0.1 to 0.3 percentage points, according to a study.

      The Korea Institute of Finance on Thursday said the tragic deaths of hundreds of passengers, mostly students from a high school in Gyeonggi Province, appears to have led to greater restraint among people, who seem to feel guilty about conspicuous consumption while the search for bodies continues.

      As a result, the think tank lowered its 2014 growth outlook from 4.2 percent to 4.1 percent. If the impact of the Sewol tragedy lasts until the third quarter, it could fall to 3.9 percent.

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