Korea's Per Capita National Income Likely Surpasses Italy in G7... 10th Largest Economy

South Korea's Economic Scale Expected to Rise in Ranking... Ranked 10th
Russia 11th, Brazil 12th Expected

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] Last year, South Korea's per capita Gross National Income (GNI), which reflects the living standards of its citizens, is estimated to have surpassed Italy, a member of the Group of Seven (G7) countries. Although South Korea's per capita income fell to the low 30,000-dollar range, the indicators for Europe, which was severely impacted by the COVID-19 pandemic, declined even further.

According to the Bank of Korea on the 12th, South Korea's nominal per capita GNI last year is estimated to have slightly decreased from $32,115 in 2019 to around $31,000. This is due to a negative real growth rate, a nominal growth rate dropping to just above 0%, and a rise in the won-dollar exchange rate. However, South Korea's ranking in per capita GNI is expected to rise.

Based on calculations by the World Bank (WB) applying the average exchange rate over the previous three years, Italy's per capita GNI in 2019 was $34,530, narrowly ahead of South Korea's $33,790 that year.

Considering that the Organisation for Economic Co-operation and Development (OECD) projected Italy's nominal growth rate at -7.9%, significantly lower than South Korea's 0.1%, Italy's per capita GNI is likely to be less than South Korea's.

In this regard, President Moon Jae-in stated in his New Year's address the day before, "Our economy is expected to achieve the highest growth rate among OECD countries last year and enter the world's top 10 in GDP size," adding that per capita income is also predicted to surpass G7 countries for the first time in history.

Although the official figures have not yet been released, if these expectations materialize, it will mark the first time South Korea's per capita GNI surpasses one of the major advanced countries known as the G7 (United States, Japan, United Kingdom, France, Germany, Italy, Canada).

Italy's per capita income has traditionally been ahead of South Korea's.

According to the World Bank, South Korea's per capita GNI was about $2,600 less than Italy's in 2016, at $29,330 compared to Italy's $31,950, and South Korea also lagged behind Italy in 2018 with $32,730 versus $33,840.

Meanwhile, South Korea's economic size ranking is also expected to rise.

According to the International Monetary Fund (IMF) World Economic Outlook report, South Korea's GDP in 2020 is projected to be $1.5868 trillion, ranking 10th globally. This is a two-step rise from 12th place in 2019. Brazil and Russia, which were ahead of South Korea the previous year, are expected to rank 12th and 11th, respectively.