Anchor: The Korea Development Institute on Thursday issued a gloomy outlook for the nation, saying the potential economic growth rate will nearly flatline to around zero percent in 15 years amid a super aging society, unless major reforms are made.
Rosyn Park reports.

Report: The Korea Development Institute(KDI) estimated in a report published on Thursday that the country’s potential growth rate will be around one-point-five percent for this year and maintain that rate until 2030.

The outlook is down from the KDI’s one-point-nine percent potential growth rate estimate from five years ago.

The KDI also warned that the potential growth rate could continue to fall, reaching zero-point-seven percent in the 2030s and zero-point-one percent in the 2040s, with both figures reflecting a zero-point-six percentage point downgrade from the 2020 projections.

According to the state-run think tank, the prospect of a zero-growth economy can be attributed to demographic changes.

With the working-age population expected to shrink rapidly, it’s projected that in around five years, labor input will start making a negative contribution to growth.

But this scenario is based on the assumption that the average economic performance of the last 10 years will continue in the future.
 
The KDI said that under a pessimistic scenario in which the U.S.-China trade war intensifies and economic structural reforms are delayed, the potential growth rate could drop into negative territory from 2041.

To avoid this worst-case scenario, the KDI said action is urgently needed to boost growth, and recommended the country focus on the productivity of the whole economy, including economic structural reforms and management and labor market innovation. 
Rosyn Park, KBS World Radio News.