The finance ministry's monthly greenbook released Friday says the country's economic recovery could be limited by the coronavirus outbreak if it persists.
The ministry was otherwise optimistic, saying that the economy is still on a recovery path thanks to increasing employment, rising production and investment in facilities, and a rebound in domestic consumption.
The greenbook highlighted that the number of people employed in January reached 26.8 million, up 568-thousand on-year.
Production across all industries in December increased 3.2 percent on year, while investment in facilities was also up 11.1 percent.
Domestic consumption increased in the 4th quarter of last year, up 1.7 percent compared to a year earlier.
The greenbook also said the Korean economy will likely get a boost from higher prices for D-RAM semiconductors and a recovery in the global economy.
However, the greenbook mentioned that the Chinese and world economies are at risk from the coronavirus outbreak, which in turn could hamper Korea's own recovery.
South Korean economic officials vowed on Friday that the government will do its utmost to minimize the coronavirus's impact economically.
"The government will deploy all available policy measures to minimize the economic impact, support the affected sectors and keep the economy on the path to recovery."
In a meeting with Finance Minister Hong Nam-ki, Bank of Korea Governor Lee Ju-yeol also said the central bank is working on financial aid for the sectors hardest hit by the outbreak, including the service and manufacturing industries.
The outbreak could lower the economic growth in the first quarter, so the finance vice minister urged the public sector to maximize investments in the first half of the year.
This year, the public sector is set to invest around 50.7 billion U.S. dollars.
Eum Ji-young Arirang News.