But the bank presidents forecast the country‘s construction investment to slow down in the new year amid a government push to cool the housing market.

“The South Korean economy will be able to grow 3 percent next year, driven by strong exports and investment,” said Shinhan Bank President Wi Sung-ho. “Private consumption is also likely to recover, helped by government efforts to create more jobs and boost growth by coaxing consumers to spend more,” Woori Bank chief Sohn Tae-seung chimed in.

“With the world economy in a slow recovery phase, exports and corporate investment will keep their growth momentum next year. But growth of construction investment is expected to lose traction,” he said.

Nonghyup President Lee Kyung-seob said domestic demand is likely to recover next year thanks to the effect of government policies though exports are projected to slow down due to worsening conditions.

The bank chiefs projected the chip industry, which has led the country’s economic growth this year, to remain brisk in the new year, while the shipbuilding and maritime sectors will likely languish in the doldrums.

Of the five bank heads, three expected the Bank of Korea to carry out an interest rate hike once next year, with the remainder anticipating two raises.

In a monthly policy meeting last week, the Bank of Korea (BOK) hiked the base rate by a quarter percentage point to 1.5 percent amid clear signs of an economic recovery, snapping the 16-month run of its wait-and-see stance. (Yonhap)