Issue Upside scenario: trade de-escalation, faster AI productivity gains and structural reform

Summary

Alongside the downside risks, KISDI records three developments that could lift growth above the baseline. If negotiations among major economies succeed in lowering tariffs or reducing trade policy uncertainty, business confidence could improve and investment and trade could revive. Faster than expected adoption and diffusion of artificial intelligence could raise productivity and stimulate investment, becoming a driver of higher world growth. An acceleration of structural reforms such as broader labour market participation and deregulation, or more expansionary fiscal policy in major economies, could support growth in the short run. The institute presents these as conditional possibilities rather than its central expectation.