Heads of South Korea’s leading economic think tanks predicted Sunday the country will have a hard time pulling off growth reaching the upper 3 percent range in 2015 mainly due to weak domestic consumption and sluggish export conditions.

The leading economists said in a poll that the South Korean economy will be weighed down by expectations of interest rates going up in the United States, a slowdown of growth in China and India, and deflation concerns in Japan and the eurozone.

Such conditions will make it hard for the economy to reach the level of growth being targeted by the government, which is around 3.9 percent, they said, forecasting 3.6-3.7 percent growth is more realistic for 2015.

The economists surveyed are presidents of the Korea Development Institute, Korea Institute for International Economic Policy, Korean Economic Association, Korea Economic Research Institute, Korea Institute of Finance, Hyundai Research Institute and LG Economic Research Institute.

In particular, the top economists expressed considerable concerns about the export sector.

The weak Japanese yen, which has hurt the price competitiveness of South Korean products, is a source of grave concern along with sluggish growth in Japan and eurozone countries, they said.

In addition, think tank chiefs said external uncertainties will exert a negative pull on the economy as a whole.

KIEP head Lee Il-houng said South Korea’s growth will only advance around 3.5 percent in the new year, effectively unchanged from 2014.

This was the most downbeat prediction made by any economist.

In the area of foreign exchange rates, think tank heads all predicted a stronger U.S. dollar and weaker Japanese yen, yet differed on the scope.

KIF predicted the South Korean currency will hover at an average of 1,050 won to the U.S. greenback, with KERI and KEA expecting 1,045 won and 1,100 won to the dollar in the new year.

On consumption and investment, all think tanks concurred there is little chance of any serious comeback in 2015.

Most think tanks, moreover, expressed concerns that consumer prices may be restricted to 1 percent growth for the third straight year in 2015. Only KERI and KDI carefully forecast inflation figures in the 2 percent range.

The think tank chiefs then forecast Seoul will maintain its expansionary fiscal and monetary policy stance in the new year, with half saying that key rates will be lowered again in 2015, from the current record low of 2 percent.

They added that government policymakers must take steps to remove unnecessary red tape, while companies engage in corporate restructuring to stay competitive. (Yonhap)