S Korean economy to grow below 4% in 2009

SEOUL, Oct. 15 (Xinhua) -- Bank of Korea Governor Lee Seong-tae said that the South Korean economy is expected to grow less than 4 percent in the first half of next year, the Korea Times reported Wednesday.

"It doesn't seem that Korea's gross domestic product (GDP) will expand by over 4 percent in the first half of 2009. And it is too early to say the economy will get better in the second half because of uncertain global economic conditions," Lee said at the annual meetings of the International Monetary Fund (IMF) and the World Bank.

During his speech at Washington, Lee hinted the possibility of an additional rate cut in the coming months, saying the central bank will consider the current account balance and other economic variables along with the inflation rate when deciding the interestrate policy.

He stressed that under current situation achieving a balanced current account is the nation's top priority as the country's trade deficit is expected to reach around 10 billion U.S. dollars this year.

"Some people think achieving high growth is more important than inflation control and others don't. But the important thing under any circumstance is to accomplish a balanced account," Lee said.

Lee also made a comment on the nation's ongoing dollar shortage despite central bank's effort to provide greater liquidity through currency swap deals.

He said the supply and demand of dollars, as well as the foreign exchange rate, should be determined by market players while the country should focus on creating an environment for the won to be widely used for international trade and capital transactions.