By Kim Minji 

The International Monetary Fund (IMF) says, "The Korean government's actions have been very successful in limiting the severity of the COVID-19 outbreak and lessening its economic impact."

The IMF on April 29 posted an analysis titled "Mountains after Mountains: Korea is Containing COVID-19 and Looking Ahead" on its website, saying, "Korea's sound economic fundamentals and decisive policy response helped it navigate the COVID-19 shock well."

Korea's infection rate was below those of its peers thanks to its effective containment strategy including data-intensive contact tracing, it added, with the nation's comprehensive economic response including fiscal support for workers and businesses and measures to rapidly stabilize financial markets.

"These steps helped make the downturn the smallest among advanced (Group of 20) economies, with real GDP growth in 2020 of -1.0%," the IMF said.

"The economy is recovering quickly, although the pace of recovery is uneven across sectors," the analysis added. "Given this 'K-shaped' recovery and remaining uncertainties surrounding the pandemic, the authorities are appropriately maintaining supportive fiscal and monetary policies."

The fund also called the Korean government "proactive" in supporting troubled economic sectors, adding, "Korea’s financial system has weathered the COVID-19 shock relatively well, a testament to years of sound macro-financial policy management."

"As economic activity normalizes, reforms are needed to boost growth potential and enhance inclusiveness."

On the Korean New Deal, the IMF said it "rightly aims to help boost inclusive growth and facilitate post-COVID-19 structural transformation by promoting digitalization, accelerating the transition to a low-carbon economy, and strengthening the social safety net."

"These measures should help boost productivity in the service sectors and reduce remaining inequalities faced by women, youth, and the elderly."

kimmj7725@korea.kr