Seoul: A significant adjustment in South Korea's economic outlook was announced as the Korea Development Institute (KDI) reduced its 2025 growth forecast to 2 percent. This revision reflects concerns over a slowdown in export activities despite some positive trends in domestic demand. According to Yonhap News Agency, the KDI's recent projection marks a slight decline from its previous estimate of 2.1 percent made in August. The anticipated growth rate for 2025 indicates a further dip from the 2.2 percent forecasted for 2024. The KDI attributed the downward revision primarily to the expected deceleration in export growth, despite improvements in domestic demand indicators. For 2024, the KDI has also adjusted its growth expectations, lowering the forecast from 2.5 percent to 2.2 percent. Jeong Gyu-cheol, a senior researcher at the KDI, explained at a press briefing that the 0.3 percentage point downgrade was largely due to internal economic factors, particularly the slower-than-anticipated recovery in domesti c demand. In terms of private consumption, the KDI predicts a 1.8 percent on-year growth in 2025, an increase from the 1.3 percent forecasted for the current year, supported by lower interest rates. Additionally, facility investment is expected to rise by 2.1 percent next year, driven by positive developments in the semiconductor industry and continued low interest rates. The KDI's export growth forecast for 2025 has been significantly reduced to 2.1 percent, a steep decline from the 7 percent projected for 2024, amid persistent uncertainties in the global trade market. The think tank highlighted potential challenges from an "America First" trade policy under U.S. President-elect Donald Trump, which could impact South Korea's export-dependent economy. Consumer prices in South Korea are expected to increase by 1.6 percent on-year in 2025, down from 2.3 percent in 2024, reflecting declining oil prices. The KDI noted that this inflation forecast is below the target rate of 2 percent. Regarding employment, th e KDI forecasts a 140,000 on-year increase in the number of employed people in 2025, a decrease compared to the 180,000 on-year growth observed this year, as the effects of a shrinking working-age population become more evident. Meanwhile, the International Monetary Fund (IMF) has maintained its growth forecast for South Korea at 2.2 percent for 2025, commenting on the resilience of the global economy during this disinflationary period.