Seoul: President Lee Jae Myung on Tuesday called for efforts to increase the country's potential growth rate to 3 percent by stabilizing prices and fostering innovative growth engines.
According to Yonhap News Agency, Lee issued the call during a Cabinet meeting, citing a sharp increase in exports in the first half of the year, led by the semiconductor sector. "There have been a series of forecasts that this year's real growth rate will reach 3 percent based on the remarkable export performance and increased capital investment," he stated during the meeting at Cheong Wa Dae.
"We must gradually raise the potential growth rate to 3 percent by making all-out efforts to stabilize prices and the property market while fostering super-gap and game-changing growth engines," he added. This appeal comes amid projections that the country's potential growth rate may fall to a record low of around 1.5 percent next year, with the central bank previously forecasting a decline to the zero percent range by the 2040s if left unaddressed.
The potential growth rate is a crucial economic indicator that refers to the sustainable increase in the gross domestic product (GDP) a country can achieve by fully utilizing labor, capital, and other resources without triggering inflation. Lee emphasized that the second half of the year will be pivotal in determining the country's trajectory for the next 30 years, urging for an accelerated "grand economic transformation" during this period.
He urged Cabinet members to consolidate their efforts to ensure this year marks the beginning of South Korea's leap towards achieving a 3 percent potential growth rate, becoming a top four world trade power, and reaching a per capita income of US$50,000. Lee also highlighted the outcomes of his recent participation in the North Atlantic Treaty Organization summit and his state visit to Mongolia, noting "considerable achievements" in securing critical mineral supply chains and expanding cooperation in the defense and cutting-edge industries.
"For the Republic of Korea to make a greater leap and grow continually, there must be a more stable and peaceful world order to back it up," Lee remarked. "Though the world order is extremely unstable at the moment, our government will fulfill its role and responsibilities unwaveringly as a global responsible power and based on our national interest-centered pragmatic diplomacy."