S. Korean economy seems to have bottomed out: IMF official

By Hwang Doo-hyong
WASHINGTON, June 19 (Yonhap) -- South Korea's economy appears to have hit bottom
amid moderating slowdown in the global economy enduring the worst recession in
decades, an official of the International Monetary Fund said Friday.

"We are cautiously optimistic that the worst is behind us," Subir Lall, the
division chief for Korea in the Asia and Pacific Department of the IMF, said of
the world's 13th biggest economy.
Speaking to a forum sponsored by the Korea Economic Institute here, Lall linked
the pace of South Korea's recovery to the global economy, struggling to muddle
through the recession sparked by the subprime mortgage crisis on Wall Street in
September.
Lall's remarks follow the upbeat mood set by John Lipsky, IMF's first deputy
managing director, who earlier in the day forecast that the global lending
agency's quarterly global outlook to be released in early July will reflect a
moderating downturn.
In April, the IMF predicted South Korea's economy will decline 4 percent this
year before rebounding to post a modest 1.5 percent growth next year.
The Bank of Korea, by contrast, said recently that Korea's economy will contract
2.4 percent this year.
South Korean Prime Minister Han Seung-soo said last month that the country's
economy had shown signs of picking up in the second quarter of this year and that
such positive indicators could allow for up to 4 percent growth next year.
In the quarterly Economic Outlook released by the IMF in April, the global
economy was forecast to shrink 1.3 percent this year and expand 1.9 percent next
year.
A that time, the lending agency conditioned next year's growth on stepping up
efforts by governments to heal the financial sector that caused the worst
economic crisis in decades and continue to support demand with monetary and
fiscal easing.
hdh@yna.co.kr
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