The Asian Development Bank (ADB) on Thursday revised up the economic outlook for the South Korean economy this year, citing robust exports of tech products and a mild recovery in private consumption.

The ADB expected Asia's fourth-largest economy to retreat 0.9 percent this year, compared with its September forecast of 1 percent contraction. The Manila-based bank predicted the Korean economy will grow 3.3 percent next year, the same as its earlier forecast.

The ADB said the Korean economy is forecast to contract less than earlier projected in 2020 "on stronger information technology exports, some recovery in private consumption, continuing fiscal and monetary support and improved growth in major export markets."

The bank's outlook is better than the latest forecasts by South Korea's central bank, the Bank of Korea (BOK), and the Organization for Economic Cooperation and Development (OECD).

The BOK and the Paris-based OECD expected Asia's fourth-largest economy to contract 1.1 percent this year.

The South Korean economy grew at a faster-than-expected pace of 2.1 percent in the July-September period from three months earlier on improving exports. The economy retreated for the second straight quarter in the second quarter of the year amid the COVID-19 pandemic.

The country's exports, which account for half of the economy, grew 4 percent in November on-year on the back of strong sales of chips, rebounding for the first time in two months.

On inflation, the ADB maintained its 2020 and 2021 outlook for South Korea as the country's inflationary pressure remains muted amid falling oil prices and subdued domestic demand.

The bank forecast South Korea's consumer prices to grow 0.5 percent this year and pick up to 1.3 percent next year.

The ADB, meanwhile, forecast developing Asian countries to contract 0.4 percent this year and grow 6.8 percent next year. (Yonhap)