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● “KDI’s Grim Outlook: Echoes of 2008”

KDI 2025 Korean Economic Outlook: The Real Meaning of a Shocking Growth Rate!

In this article, we will review the 2025 Korean economic outlook announced by KDI.
The article systematically covers not only the forecast figures but also recent changes in economic perception, growth trends in each industry, the state of domestic demand and exports, and future countermeasures.
In particular, we will thoroughly examine the meaning of the expected growth rate of '0.8%' in 2025, the difference in forecasts with the IMF, global comparisons with the US and Taiwan, precedents in economic history, and policy implications.

Recent Economic Situation Perception

– KDI diagnoses increased economic uncertainty (both domestic and international) and slowing growth.
– The domestic market is showing a clear contraction in consumer sentiment, cancellation of year-end and New Year’s events, and a contraction in the MICE (Meetings, Incentives, Conferences, Exhibitions) industry, including accommodation and restaurants.
– Both facility investment and construction investment have plummeted. In reality, central and local governments, public institutions, and large corporations have contributed to the contraction in consumption by canceling events.

Industry-Specific Business Trends and Domestic Demand/Export Situation

– Production growth is slowing in all major industries, including manufacturing, services, and construction.
– Private consumption is decreasing, especially in the arts, leisure, accommodation, and restaurant sectors, which have suffered significant psychological impact.
– Facility investment is weakening, and construction investment is plummeting at -1%.
– Both manufacturing and non-manufacturing industries have negative outlooks for the future.
– The increase in employment is also weakening, especially with a noticeable decrease in manufacturing employment.
– High loan interest rates continue to intensify the contraction in corporate investment sentiment.
– Exports, including automobiles and parts, show a negative ‘total export’ figure. Goods exports are decreasing even more significantly, negatively impacting overall economic growth.

Growth Rate Outlook and Historical Comparison

– Korea’s GDP growth rate is predicted to rapidly slow down from 1.4% in 2023, 2.0% in 2024, to 0.8% in 2025.
– The 0.8% growth rate is similar to the level during the Global Financial Crisis (2008).
– KDI’s forecast has plummeted by half from its prediction three months ago (1.6%), and is even lower than the IMF’s expected value (1.0%).
– It is also projected that growth will remain at 1.6% in 2026, falling below the potential growth rate (around 2%).
– This is unusually low compared to Korea’s four recent economic crises (1980 at -1.5%, IMF at -4.9%, pandemic at -0.7%, financial crisis at 0.0%).
– The slowdown in growth indicates a weakened structure vulnerable to external economic shocks, with both domestic demand and exports being sluggish.

Global Comparison and Policy Evaluation

– The US’s negative growth in the first quarter is due to a ‘surge in imports (pre-reflection of the tariff war)’, and there is no structural problem.
– Taiwan, on the other hand, benefited from the surge in US and global imports, achieving growth in the 5% range in the first quarter.
– Korea, conversely, experienced its own negative growth due to poor exports in the first quarter. In other words, both policy responses and domestic/export conditions have been confirmed to be weak.
– It is emphasized that proactive and active policies are needed to address the impact of external uncertainties (unprecedented tariffs, intensified US-China trade conflicts, etc.).

Policy Implications and Future Response

– Reflecting KDI’s sober outlook, it is important to recognize reality and compete on countermeasures in the upcoming political (election) process.
– Macroeconomically, it is necessary to monitor economic trends, implement flexible monetary and fiscal policies, and provide customized support measures for each industry.
– National oversight and selection regarding economic leadership are important.

Conclusion: Recognizing the Economic Crisis and Responding to the Future

– This is a warning sign that the economy may be entering a long-term recession.
– Policy leaders and the public must all face reality and find a ‘groundbreaking breakthrough’.
– After diagnosing the economic situation, it is essential to consider structural solutions to restore growth potential.

< Summary >
KDI's 2025 economic outlook is an unprecedented warning signal that the growth rate of 0.8% is at the same level as the Global Financial Crisis.
This is due to a contraction in domestic demand and a simultaneous slump in investment/exports.
Compared to major global countries such as the US and Taiwan, it shows a decline in response and recovery capabilities.
Political and policy leadership must accurately grasp the reality of the crisis and propose countermeasures, and a structural growth strategy and bold policy responses are needed.

KDI 2025 Economic Outlook Summary: Growth Rate Shock, Sluggish Domestic Demand-Exports, What are the Future Challenges?

Analysis of KDI's 2025 Korean Economic Outlook
The growth rate of 0.8% is similar to the level of the Global Financial Crisis
Domestic demand, investment, and exports are all sluggish, and the economic slowdown is evident
Provides global comparisons with major countries such as the US and Taiwan, and policy implications
Emphasizes the need for accurate recognition of reality and structural solutions

[Related Articles…]

• Causes and implications of the Korean economy falling into a 1% growth rate
• Analysis of domestic and international economic outlook and major variables in 2024

*YouTube Source: [경제 읽어주는 남자(김광석TV)]

– ‘R의 공포’ 국책기관 첫 0%대…KDI 올해 성장전망 0.8%로 반토막, 2008년 글로벌 금융위기 당시의 성장률과 같아. [즉시분석]

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● Nvidia-Saudi AI Chip Deal, Samsung-SK Hynix Eye Middle East Windfall

Nvidia and Saudi Arabia Collaborate on AI Chips: The Middle East AI Hegemony Competition Intensifies

In this article, we will explore:

• Why Nvidia partnered with Saudi Arabia
• How the GB300 Blackwell chip supply will transform the data center, supercomputer, and AI industries
• The impact on U.S. diplomacy, Middle Eastern economic hegemony, and the global semiconductor industry
• And the significance of Nvidia's stock surge, along with the outlook for Korean semiconductor companies (Samsung Electronics, SK Hynix)
  arranged chronologically for easy understanding.
  We've covered all the latest AI chip-related global economic keywords.

1. Nvidia-Saudi Strategic Partnership Agreement (June 2024)

• Nvidia and Saudi Humane establish a strategic partnership
• Supply of over 18,000 state-of-the-art AI chips (GB300 Blackwell)
• Supply volume to be deployed in a 500MW data center
• Agreement announcement: at the 'Saudi U.S. Investment Forum,' attended by CEO Jensen Huang
• Saudi Arabia emphasizes the promotion of large-scale supercomputers and AI factories utilizing its own energy resources

2. Saudi Arabia’s Goal of “National Leap in AI Industry” and Data Center Construction

• Securing vast power infrastructure with abundant energy resources
• Large-scale data center infrastructure under construction locally, based on the concept of an "AI factory"
• Humane plans to introduce hundreds of thousands of Nvidia GPUs additionally in the long term
• Confirmation of the will to develop local technology and proprietary AI models

3. U.S. Foreign Policy and AI Chip Hegemony Competition

• Nvidia chip collaboration coincides with former President Trump's Middle East visit
• CNBC analysis: "AI semiconductors are now a diplomatic bargaining chip"
• Intensifying competition for advanced chip acquisition centered around the U.S. in the AI hegemony, with each country fiercely competing

4. Impact on the Global Semiconductor Market and Outlook for Nvidia and Korean Semiconductor Stocks

• Following the announcement of the agreement, Nvidia's stock price surged by over 5% on the New York Stock Exchange
• Explosive demand for AI supercomputers and data centers, improving investment sentiment in the semiconductor sector
• Anticipated benefits for domestic memory semiconductor companies such as Samsung Electronics and SK Hynix
• Large-scale AI chip infrastructure from the Middle East foreshadows intensified competition in the global AI semiconductor market

5. Will the Middle East Usher in an Era of AI Technology Hubs? Future Prospects

• Saudi Arabia and Middle Eastern countries accelerate investments in new industries such as AI, big data, and smart cities
• Nvidia secures a 'new growth base' in the global AI chip market
• Intensified competition → expected to promote supply chains, investment, and technology development in the long term
• Combination of stable resource base and advanced infrastructure enables the realization of the Middle East's technological innovation scenario

< Summary >

Nvidia has signed a large-scale AI chip supply agreement with Saudi Arabia.
Construction of local data centers and supercomputers is expected to accelerate Saudi Arabia's AI industry development.
AI semiconductor collaboration is becoming a significant strategic asset in U.S. diplomacy as well.
Nvidia's stock surge is expected to have a positive impact on domestic semiconductor stocks such as Samsung Electronics and SK Hynix.
The Middle East is emerging as a new AI technology hub, and the global economic hegemony competition is expected to intensify imminently.

[Related Articles…]

• AI Chip War, Who Will Change the Game? In-Depth Analysis of AI Competition Among Semiconductor Powerhouses
• Global Semiconductor Supply Chain Restructuring, What are the Investment Points in 2024?

*YouTube Source: [서울경제TV]

– 엔비디아·사우디 ‘AI칩’ 빅딜…삼성전자·SK하이닉스 중동發 훈풍 올라탈까