Amidst the ongoing global economic slowdown due to domestic and international crises such as high interest rates and high inflation, experts have raised concerns that the Korean economy in 2023 will be dark and chaotic, like falling into a rabbit hole.

The Korea Chamber of Commerce and Industry announced on the 12th that in a survey of 85 economic and management experts titled "2023 Economic Keywords and Business Environment Outlook," the domestic economic growth rate this year was projected to be 1.25%.

Experts chose words like 'abyss' and 'lighthouse in the wind' as keywords to describe the current situation in our country, which is experiencing long-term low growth. He described our economy as falling into a dark and chaotic situation, like the rabbit hole in Lewis Carroll's novel 'Alice in Wonderland', where existing methods and strategies are no longer working.
Concerns have been raised that the national power has been weakened by the trade deficit and the accumulation of household debt, as well as the seriousness of internal political conflicts, economic conflicts between the rich and the poor, and conflicts related to businesses.

Global economic growth outlook 'gloomy' Experts projected that the domestic economic growth rate for this year would be around 1.25%, falling short of the 1.5% to 2.0% forecasts from the Ministry of Strategy and Finance, the Bank of Korea, and the OECD.

Indeed, 76.2% of respondents agreed with the statement that "this year will be the first year in which low growth becomes entrenched." 90.5% and 96.4%, respectively, predicted that "consumption and investment outlooks will remain similar to last year or slow down." 78.6% predicted that exports will remain similar to last year or slow down.

Additionally, the global economic growth rate forecast was at 2.22%, falling below the OECD and IMF averages. Regarding major educational countries, the percentage of respondents who said that the economic outlook for the US and China would be 'similar to or worse than last year' was 71.4% and 75%, respectively.

Experts cited "high interest rates" as the cause of our economic crisis in 2023, with 24.5% citing it, and 20.3% citing "persistent high inflation and raw material prices." This was followed by export slowdown and prolonged trade deficit (16.8%), domestic economic downturn (15%), and geopolitical risks such as US-China conflict and war (13.8%).

When deciding on future interest rate policy, 39.3% of respondents said the 'US interest rate level' should be considered, followed by economic conditions, debt situation, and domestic price levels.

■ Urgent need to foster future strategic industries such as batteries
Nevertheless, experts rated the Korean economy's performance last year as a 'B', saying that our economy 'performed well' compared to domestic and international conditions.

Professor Cho Sung-hoon of Yonsei University's Department of Economics gave a positive assessment, saying, "Consumption did not decline significantly as we entered the post-COVID era, and various industrial bases such as semiconductors, automobiles, and petrochemicals were well-established."

In particular, 'batteries (21.2%)', 'bio (18.8%)', 'mobility (16.5%)', and 'artificial intelligence (10.6%)' were suggested as future food industries that will lead our country. Next-generation semiconductors (5.9%) and robots (3.5%) followed. The most frequently cited economic policy area for the government to prioritize this year was "fostering future strategic industries" (25%), highlighting the urgent need for short-term tasks such as stabilizing capital and financial markets and fostering future strategic industries.

Last year, Korean companies, including Hyundai Motor Company and LG Energy Solution, made inroads into Indonesia by building joint ventures for electric vehicle and battery cell production. Furthermore, the Korea Institute of Machinery and Materials (KIMM) published a book on waste battery recycling, highlighting the importance of waste battery recycling technology, and is working to dominate the battery market.

The Ministry of Land, Infrastructure and Transport announced that this year's R&D budget is 641.9 billion won, with 287.8 billion won invested in future mobility, including autonomous driving and urban air mobility (UAM). Furthermore, to achieve the commercialization of urban air mobility (UAM), a next-generation transportation mode, by 2025, the Ministry launched "UAM Team Korea (UTK)" and is actively pursuing the Korean Urban Air Mobility (K-UAM) demonstration project (Grand Challenge).

Professor Cho said, “We need to diversify our national competitiveness by strengthening the competitiveness of our core industries while also promoting a wider range of industries, such as bio, defense, and eco-friendly energy.”

Hwang Kyung-in, a researcher at the Korea Institute for Industrial Economics and Trade, said, “In a situation where major countries are actively pursuing industrial and trade policies based on a national priority approach, such as the IRA, we also need to expand policy support to strengthen our basic capabilities, such as regulatory reform, support for next-generation technology development, and human resource development.”