[Edaily Reporter Jang Young-eun ] As the semiconductor “super cycle” continues amid expanding investment in artificial intelligence (AI), overseas institutions are raising their growth forecasts for the South Korean economy. With exports continuing to hit record highs, some forecasts suggest this year’s growth rate could approach 4%.

According to the International Finance Center on the 10th, the average forecast for South Korea’s economic growth this year from eight major Asian investment banks (IBs) stood at 3.2% as of the end of last month. This represents a 0.2 percentage point upward revision from the end of the previous month (3.0%). JPMorgan projected 3.8% and Citigroup 3.7%, forecasting a high growth rate approaching 4%.

The Bank of Korea had previously presented a growth forecast of 2.6% for this year when it released its economic outlook in May, but indicated last month during its monetary policy decision that it would need to significantly raise its existing forecast. The Bank of Korea will announce its revised economic outlook on the 27th when it sets the benchmark interest rate.

Six out of the eight institutions raised their forecasts within the past month. HSBC made the largest adjustment, raising its growth forecast by 0.6 percentage points from 2.8% to 3.4%. Barclays (2.7% → 3.2%) and Goldman Sachs (2.7% → 3.2%) also made significant adjustments, each raising their forecasts by 0.5 percentage points.

Behind this string of upward revisions to growth forecasts lies the unrelenting semiconductor supercycle. With AI-related demand surging, both semiconductor prices and export volumes have remained at high levels. Consequently, July exports soared 62.8% year-over-year to $98.89 billion, while the trade surplus reached $30.32 billion—both marking the second-highest levels on record.

However, there are also negative risk factors for growth. Domestic and international uncertainties persist, including △renewed tensions in the Middle East, △U.S. tariff policies, and △inflation concerns, while exports in the non-IT sector are showing relatively sluggish performance.

However, market experts generally agree that the strong export boom in IT products, led by semiconductors, is robust enough to offset these downside risks. Reflecting this positive trend, foreign investment banks’ average forecast for the current account surplus as a percentage of nominal gross domestic product (GDP) was revised upward from 14.0% at the end of June to 14.7% at the end of July.

Lee Yoon-tak, a senior researcher at the International Finance Center, assessed, “There are signs that the growth momentum in AI-related exports is spreading to semiconductors and other capital investments.” In its August Economic Trends report published the same day, the Korea Development Institute (KDI) noted, “While exports and capital investment, led by semiconductors, showed strong growth, the pace of consumption growth also accelerated, driven by durable goods.” It added, “Total industrial production recorded a relatively high growth rate as the manufacturing sector rebounded amid continued favorable trends in the service sector.”

Overseas investment banks forecast that, following this year’s steep growth, South Korea’s economic growth rate will remain at a robust 2.5% next year.

Meanwhile, Taiwan—which is often compared to South Korea as a prime example of a country benefiting from the semiconductor boom—has also seen its growth forecast for this year significantly revised upward by 0.6 percentage points to 10.7% compared to a month ago. Taiwan’s average growth rate for next year is projected to be 4.8%, roughly double that of South Korea.