The Korea Institute of Finance(KIF) predicted Monday the South Korean economy will grow three percent this year.

The think tank raised the economic growth target from two-point-eight percent, citing continuous export growth amid spreading economic recovery around the world.

The KIF attributed its optimism to the improved facility investment and solid growth of construction investment, as well as to the 11-trillion-won supplementary budget.

KIF researchers credited the new government's economic policies with easing uncertainty,
but cautioned that slow recovery of consumer spending and high volatility of construction investment could reverse that progress.