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Korea¡¯s economy could shrink during the first quarter of next year, experts warn. It would be the first time in six years that quarterly growth was negative since the first quarter of 2003 (-0.4 percent), at the height of the credit card crisis.
Kim Hyun-wook, a researcher at the state-run Korea Development Institute, on Wednesday said there is a strong chance of negative growth in the first quarter "if the economy worsens at the current rate."
Two consecutive quarters of negative growth are viewed as a full-fledged recession. Most international organizations such as the OECD and the International Monetary Fund as well as domestic think tanks predict Korea¡¯s economy will grow just around 2 percent next year.
Yoo Byung-kyu, an economist at the Hyundai Economic Research Institute, said growth could stay flat or shrink in the first or second quarter.
The economy has shrunk five times so far: in the fourth quarter of 1997 during the Asian financial crisis (-0.4 percent), the first quarter of 1998 (-7.8 percent) and the second quarter of the same year (-0.8 percent); when the IT bubble burst in the fourth quarter of 2000 (-0.9 percent); and during the credit card crisis.
(englishnews@chosun.com )
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