The government forecast the economy to expand two-point-two percent this year, spurred by a recovery in outbound shipments of semiconductors.

In the 2024 economic policy directive on Thursday, the government said while growth stood at one-point-four percent last year, the economy, centered on exports, is likely to expand two-point-two percent this year.

The forecast is the same as that of the International Monetary Fund(IMF) and higher than the Bank of Korea's(BOK) two-point-one-percent projection put forth in November.

Exports are expected to jump eight-point-five percent on-year in 2024, largely thanks to improvements in the global chip sector. Imports are projected to rise four percent on-year, with a current account surplus of around 50 billion U.S. dollars.

Private spending and investment in the construction sector, however, are expected to see a slump, with spending likely to only rise one-point-eight percent, affected by real income reduction from inflation and high interests.

Facilities investments are predicted to increase three percent, while construction investments are forecast to drop one-point-two percent due to a slowdown in the housing market.

Inflation is expected to slow this year to two-point-six percent, down a percentage point from last year.