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The Organization for Economic Cooperation and Development (OECD) has revised South Korea’s economic growth forecast for this year from 2.1% to 1.5%, marking a 0.6 percentage point reduction. The primary reason behind this downgrade appears to be the global economic slowdown driven by escalating trade barriers. The OECD also lowered its global growth projections for this year to 3.1% and for next year to 3.0%, down 0.2 and 0.3 percentage points, respectively, compared to its December forecast.

The OECD attributed the slowdown to tariff wars led by the U.S., which have disrupted global supply chains, adding pressure on investments and household consumption worldwide. Countries with high trade exposure to the U.S. have been hit particularly hard, with growth forecasts for Canada (0.7%) and Mexico (-1.3%) seeing significant cuts. South Korea, due to its trade-dependent economy, was also among the nations experiencing substantial downward revisions.

Meanwhile, the U.S. growth forecast was lowered from 2.4% to 2.2%, Japan from 1.5% to 1.1%, and Germany from 0.7% to 0.4%. In contrast, China’s growth projection was raised slightly from 4.7% to 4.8%, with the OECD noting that policy support has helped mitigate the negative effects of trade barriers.

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