• South Korea warned of a deeper economic slowdown next year.
• It extended sales tax breaks on fuel oil products and cars.
• The economy was slowing more quickly than expected.

South Korea warned of a deeper economic slowdown next year and extended sales tax breaks on fuel oil products and cars.

“Our economy’s growth is expected to slow next year due to a global economic slump, and the difficulty will be in the first half,” Finance Minister Choo Kyung-ho said Monday at a meeting with the ruling party leadership.

He added the economy was slowing more quickly than expected.

This week, the government will announce its economic policy strategies for next year. It will be President Yoon Suk-first yeol’s full-year statement since taking office in May.

South Korea, Asia’s fourth-largest economy, exports cars, ships, chips, and smartphones. Next year’s growth is expected to be below 2%, down from 3% this year.

The central bank cut its forecast for next year’s economic growth to 1.7% from 2.1%, citing falling exports and reduced corporate investment.

As the economy relies more on domestic consumption to offset cooling export demand, the finance ministry has extended by six months tax breaks on fuel oil products and car sales.

Wednesday, the ministry will release 2023 economic projections and strategies.

President Yoon says exports are the best way for the manufacturing-heavy country to recover.

China, South Korea’s top export market, is suffering from years of strict COVID-19 controls.

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