South Korea will achieve a growth of 7.2 percent in gross domestic product (GDP) this year due to the steady increase of exports and domestic consumption, said Bank of Korea Governor Chon Chol-hwan on January 18.

He said exports, led by semiconductors and other information and telecommunications-related products, will reach 158.4 billion US dollars this year, a 10-percent increase from 1999. And imports will reach 146.8 billion dollars, up 23 percent due to increased domestic consumption and oil prices.

He said the trade surplus is estimated to be 11.5 billion dollars this year, compared with 7.2 billion dollars last year.

He said the inflation rate will hit three percent in 2000 because of the pressure of wage hikes, rising prices of new materials on the world market and higher domestic real estate prices.

He also said South Korea's foreign exchange reserves will increase.

Last Monday, South Korea announced that it will raise its foreign exchange reserves to 90 billion dollars at the end of this year.

The nation's foreign exchange reserves rose to 74 billion dollars at the end of 1999 as domestic banks and financial institutions returned their debts to the central bank. (Xinhua)