South Korea's main think tank lowered its forecasts for the country's economic growth on Sunday, citing slowing demand from the West and a strong currency that is holding back exports.
The state-run Korea Development Institute (KDI) said in its twice-yearly report that Asia's fourth largest economy would grow by 3.6 percent in 2011, compared with its May estimate of 4.2 percent.
It said it now expected 3.8 percent growth in 2012, down from 4.3 predicted in May.
"Amid the global downturn, the uncertainty surrounding the domestic economy's growth path has increased," the KDI said in a statement, adding the slowdown would continue "at least until the first half of next year". "Export growth will slow, while local demand is expected to eke out a modest gain, supporting the overall economy," it said. The downgrade followed similar revisions by many private researchers and global institutions, which have cut growth forecasts to below 4 percent and called Seoul's official projection of 4.5 percent growth in 2012 unrealistic.
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