IMF upgrades forecast on S. Korea's economy for 2020

The International Monetary Fund (IMF) upgraded its forecast on South Korea's economy and is now expecting it to shrink by 1.9 percent this year from its previous prediction of 2.1 percent contraction in June.

The IMF also painted a brighter picture of the global economy, expecting it to shrink 4.4 percent this year from its previous 5.2 percent contraction.

Last month, South Korea's National Assembly approved a fourth extra budget worth 7.8 trillion won to help small businesses cope with the economic impact of the pandemic, which includes protecting jobs.

The extra budget raised the total of the nation's stimulus packages to 278 trillion won in response to the pandemic.

The country will maintain its aggressive fiscal policy to fight the pandemic, which will push up the debt-to-GDP ratio to 43.5 percent this year from the 40 percent before there was a pandemic.

The IMF pointed out that extensive stimulus packages that almost every country has implemented have kept the economic downturn of 2020 from worsening.

The disruption of global businesses and low consumer demand are expected to hamper South Korea's export-reliant economy.

Nonetheless, the country's exports rebounded in September after seven months of decline, reaching $48 billion, up 7.7 percent from $44.6 billion the previous year.

The improved performance of exports is attributed to increased shipments of automobiles and chips as more countries resumed economic activities..