South Korea is expected to face difficulty in achieving an annual economic growth of 3 percent in the coming years as consumption is crimped by the aging population and rising household debts, a Bank of Korea board member said Friday.

Cho Dong-chul also voiced worries that the country's economy could move in the direction of the long-drawn slump seen by Japan in the 1990s.

The central bank has predicted that the nation's economy could grow 2.6 percent this year, compared with 2.8 percent growth reached in 2016.

The remarks by Cho came as the central bank has kept its key interest rate at record-low levels for the past year, while the U.S. Federal Reserve is almost certain to raise its policy rates again next week.

South Korea's "potential economic growth would be below the 3 percent level seen in the early 2010s," Cho told a lecture organized by the central bank.

He said South Korea is experiencing similar situations seen in Japan about 20 years ago, given a demographic change and the real growth rate trend.

"It is necessary for us to increase productivity and maintain inflation at an appropriate level," the official stressed. (Yonhap)