KDI “생산성 향상 노력 없으면 2020년대 1%대 성장”<br /><br />A report by a top government think-tank shows Korea's economic growth could slow down even further due to stalled productivity and slowing population growth.<br />Here's Arirang's chief economic correspondent, Kim Hyesung. <br />The Korea Development Institute says that at the current level of productivity, South Korea's average economic growth could slow to 1-point-seven percent a year during the next decade. <br />In its report released on Thursday, the KDI said Korea's economic growth slowed from an annual average growth rate of four-point-four percent in the 2000s to three percent between 2011 and 2018 mainly due to slowing total factor productivity. <br />Total factor productivity reflects how efficiently inputs excluding labor and capital, such as technology, the legal system and resource distribution, are used in the production process.<br />But total factor productivity's contribution to Korea's GDP growth has more than halved from one-point-six percentage points in the 2000s to zero-point-seven percentage points between 2011 and 2018. <br />And labor productivity's contribution to GDP growth is forecast to fall from zero-point-eight percentage points between 2011 and 2018 to zero-point-two percentage points in the 2020s due to the shrinking working age population.<br />The think tank said it is critical that industry succeeds in improving productivity through technological innovation and deregulation in the long-run to boost total factor productivity rather than short-term measures like an expansionary fiscal policy. <br /> If total factor productivity is raised to one-point-two percentage points, the KDI says the contribution of capital productivity can go up and help lift Korea's annual average GDP growth to two-point-four percent for the 2020s. <br />Kim Hyesung, Arirang News. <br />
