SEOUL: South Korea's state-run think-tank on Monday cut its forecast for the country's growth this year to 2.5 percent, citing the eurozone debt crisis.
The Korea Development Institute's latest outlook is well below the government's revised growth forecast in June of 3.3 percent, and over a percentage point below a May prediction of 3.6 percent.
The country's exports dropped sharply for a second straight month in August, suggesting the export-reliant economy is struggling with shrinking demand overseas.
It said Asia's fourth-largest economy is expected to expand 3.4 percent next year, gradually recovering from the slowdown caused by slow exports and sluggish domestic demand.
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