{
  "title": "IMF Staff Concludes 2019 Article IV Mission to Korea",
  "publication": "IMF News, March 12, 2019",
  "sourceUrl": "https://www.imf.org/en/news/articles/2019/03/11/korea-pr1975-imf-staff-concludes-2019-article-iv-mission-to-korea",
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  "summary": "An IMF team led by Tarhan Feyzioglu visited Seoul during February 27–March 12 to conduct discussions for the 2019 Article IV Consultation.",
  "publishDate": "2019-03-12",
  "sections": [
    {
      "heading": "Mission timing and leadership",
      "content": "- An IMF team led by Tarhan Feyzioglu visited Seoul during February 27–March 12 to conduct discussions for the 2019 Article IV Consultation.\n- Press Release No. 19/75\n- March 12, 2019"
    },
    {
      "heading": "Assessment of Korea’s economic fundamentals and challenges",
      "content": "- Strong fundamentals: skilled labor force, strong manufacturing base, stable financial system, low public debt, and ample foreign exchange reserves.\n- Per-capita income recently exceeded thirty-thousand dollars.\n- Short- and medium-term headwinds with risks tilted toward the downside:\n  - Growth is moderating on the back of sluggish investment and global trade.\n  - Inflation pressures are weak.\n  - Employment creation has been tepid.\n  - Household leverage is high and continues to increase.\n  - Potential growth has declined, hindered by unfavorable demographics and declining productivity growth.\n  - Polarization and inequality are concerns.\n  - Substantial productivity gap between the manufacturing and service sectors, and between small and large firms."
    },
    {
      "heading": "Policy evaluation and recent government actions",
      "content": "- Authorities have moved to a more expansionary fiscal stance.\n- Government focus areas: supporting job creation, strengthening social safety nets, and increasing the minimum wage.\n- Steps to promote growth through innovation by supporting small- and medium-sized enterprises.\n- To contain financial risks the authorities have broadened and tightened macroprudential measures."
    },
    {
      "heading": "IMF staff recommendations — macroeconomic and financial policies",
      "content": "- Provide more fiscal stimulus through a substantial supplementary budget to support short-term growth and contain risks, with measures that promote potential output.\n- The Bank of Korea should have a clearly accommodative monetary policy stance.\n- Maintain appropriately tight macroprudential policies to preserve financial sector resilience.\n- Staff recommend an integrated package of further macroeconomic, financial and structural policies to:\n  - support growth,\n  - raise potential output,\n  - reduce excess internal and external imbalances,\n  - preserve financial stability."
    },
    {
      "heading": "IMF staff recommendations — structural and labor market reforms",
      "content": "- Fiscal policy should remain expansionary in the medium-term to promote long-term, inclusive growth and job creation.\n- Adopt flexicurity as a basis for labor market policies by:\n  - making employment protection legislation more flexible,\n  - further enhancing social safety nets and Active Labor Market Policies.\n- Promote female labor market participation, including through improved childcare and child benefits.\n- Address rigidities in product market regulations by further reducing barriers to entry and the protection of incumbents.\n\nIMF Staff Concludes 2019 Article IV Mission to Korea — Press Release No. 19/75, March 12, 2019.\n\n---\n\n\n References\n\n- Republic of Korea and the IMF\n- IMF Policy Advice -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2019/03/11/korea-pr1975-imf-staff-concludes-2019-article-iv-mission-to-korea"
    }
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    "Published: March 12, 2019",
    "An IMF team led by Tarhan Feyzioglu visited Seoul during February 27–March 12 to conduct discussions for the 2019 Article IV Consultation.",
    "Press Release No. 19/75",
    "March 12, 2019",
    "Strong fundamentals: skilled labor force, strong manufacturing base, stable financial system, low public debt, and ample foreign exchange reserves.",
    "Per-capita income recently exceeded thirty-thousand dollars.",
    "Short- and medium-term headwinds with risks tilted toward the downside:",
    "Authorities have moved to a more expansionary fiscal stance.",
    "Government focus areas: supporting job creation, strengthening social safety nets, and increasing the minimum wage.",
    "Steps to promote growth through innovation by supporting small- and medium-sized enterprises.",
    "To contain financial risks the authorities have broadened and tightened macroprudential measures.",
    "Provide more fiscal stimulus through a substantial supplementary budget to support short-term growth and contain risks, with measures that promote potential output.",
    "The Bank of Korea should have a clearly accommodative monetary policy stance.",
    "Maintain appropriately tight macroprudential policies to preserve financial sector resilience.",
    "Staff recommend an integrated package of further macroeconomic, financial and structural policies to:",
    "Fiscal policy should remain expansionary in the medium-term to promote long-term, inclusive growth and job creation.",
    "Adopt flexicurity as a basis for labor market policies by:",
    "Promote female labor market participation, including through improved childcare and child benefits.",
    "Address rigidities in product market regulations by further reducing barriers to entry and the protection of incumbents.",
    "[Republic of Korea and the IMF](http://www.imf.org/external/country/KOR/index.htm)",
    "[IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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