South Korea’s economic growth is expected to slow to 3.5 percent in 2012 from a 3.6 percent expansion last year as global uncertainties hurt exports, a private think tank said Thursday.

In its growth outlook, Hyundai Research Institute said first half growth has been affected by protracted eurozone woes and sluggish economic conditions in the United States and China. It said such developments have hurt outbound shipments that play an important role in the country’s growth.

The HRI’s forecast for 2012 represents a 0.5 percentage point decrease from 4.0 percent growth predicted earlier in the year. It is on par with estimates made by the Bank of Korea but higher than 3.25 percent growth forecast by International Monetary Fund.

Official growth figures for the first half have not been released, but Asia’s fourth-largest economy gained a modest 2.8 percent in the January-March period.

In the first five months of the year, exports edged up just 0.5 percent to $228 billion. This is a sharp contraction from 19.3 percent on-year growth tallied for the whole of 2011.

“Instead of the brisk pace of growth in the second half that could have pushed up overall annual growth numbers, gains from July onwards are expected to reach upper 3 percent levels, which falls shy of previous expectations,” the think tank said.

It, however, said that domestic consumption may pick up pace in the second half thanks to stable consumer prices. For the second half, the think tank said domestic consumption may gain 3.3 percent compared to an estimate 1.7 percent gain for the first half.

The HRI, meanwhile, said export growth for the entire year may move up 4.5 percent, with imports gaining 6.9 percent. It predicted the country’s trade surplus could reach $19.6 billion from $30.8 billion tallied for last year, with the current account being halved to $13.0 billion vis-a-vis $26.5 billion a year earlier. 

(Yonhap News)