The government will seek to reinvigorate the economy and strive to create more jobs to cope with persistent global market uncertainties, the finance ministry said Tuesday.
In its monthly "green book" report, the Ministry of Strategy and Finance said overall economic conditions improved modestly in April and May but warned external uncertainties could pose challenges in the future.
The eurozone's debt problems, coupled with slowing economic growth in the United States and China, have fueled market volatility that must be closely watched, the ministry said.
"Fiscal debt crisis in Greece and banking sector concerns in Spain, in particular, affected stock markets around the world and raised financial market volatility."
The ministry in charge of macroeconomic policy setting said more than 400,000 jobs were created in April, which helped lower unemployment to 3.5 percent from 3.7 percent the previous month. Consumer spending, a barometer of domestic economic health gained 1.0 percent in the first quarter from three months earlier, when it had contracted 0.4 percent.
Industrial production rose 0.9 percent on-month in April, with business investment gaining 10.8 percent in the first quarter compared to the last three months of 2011.
In addition, consumer prices rose 2.5 percent on-year in May, marking the third month in a row inflation stayed in the 2 percent range from 4 percent growth tallied last year.
The report said that a drop in international crude oil prices, which fell to their lowest levels this year last month, helped control domestic fuel costs.
On the country's current account, the report predicted a surplus for May thanks to steady exports of vehicles.
"Seoul will keep close tabs on both overseas and local developments, and promote more job creation vital for bolstering economic buoyancy, while at the same time controlling inflationary pressure," the ministry said.
The government predicted Asia's fourth-largest economy will grow 3.7 percent in 2012, with growth to speed up in the second half. In the first quarter, the country's gross domestic product grew a modest 2.8 percent on-year. (Yonhap)