Republic of Korea; 2006 Article IV Consultation: Staff Report; Staff Statement; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for the Republic of Korea
Korea has enjoyed strong growth owing to rapidly increasing exports and consumption. Potential growth is slowing as the population ages, whereas social polarization is growing. Korea should implement plans to build an advanced financial system and improve service productivity by opening the sector to more competition and enhancing small firms’ access to finance. It should also address the prospective long-term deterioration of the fiscal position owing to population aging by tackling the health care and pension problems, and increase labor market flexibility.
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