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He said the recovery will gather momentum toward the end of this year, as the global economy picks up steam. About half of South Korea's economic growth comes from exports, compared with less than 10 percent in the United States, making the country more vulnerable to the changes in the world economy and global trade. Bank of Korea's view on the local economy is more optimistic than the government's assessment. President Park Geun-hye's administration has emphasized that South Korea's economy is losing its vitality and is in need of a massive stimulus. The finance ministry in March sharply cut its forecast of South Korea's economic growth this year to 2.3 percent and called for an all-out effort to boost the economy, setting the tone for an extra budget that needs a parliamentary approval. In December, it said South Korea's economy would expand 3 percent. Kim said the difference between the central bank and finance ministry's growth forecasts partly stems from estimates of tax revenue, which boosts the government's public spending. "The government estimates tax revenues will be short of 12 trillion won ($11 billion) than its earlier plan while our estimate is based on the assumption that there will be no tax deficit," Kim said.
[Associated
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