Recorded Annual GDP Growth Rate of 4% Last Year
[Sejong=Asia Economy Reporter Kim Hyunjung] Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, evaluated South Korea's annual gross domestic product (GDP) growth rate of 4% last year as "the fastest and strongest recovery among G20 advanced countries." He also expressed his intention to respond to the uncertainties and adverse factors forecasted for this year, such as difficulties in some face-to-face service sectors and concerns about global inflation.
On the 25th, Deputy Prime Minister Hong posted on his personal social networking service (SNS), "In the first year of the COVID-19 crisis, 2020, our economy minimized the contraction (-0.9%), and in the second year of COVID-19, last year, achieved 4% growth, marking the fastest and strongest recovery among G20 advanced countries," adding, "This proves that our economy is strong in the face of a crisis that no one can deny." Earlier, the Bank of Korea announced that the GDP growth rate for the fourth quarter of last year was 1.1%, achieving an annual growth rate of 4.0%.
Regarding the fourth-quarter growth last year, Deputy Prime Minister Hong said, "Despite concerns raised by international organizations lowering their global economic growth forecasts due to the resurgence of COVID-19 and prolonged supply chain disruptions, and some worries that our economy might continue to slow down, our economy showed solid resilience as private consumption greatly improved and exports and fiscal spending strengthened," adding, "Moreover, as I have emphasized several times, the rebound in growth in the fourth quarter of last year raised the base for 2022 growth (Base-up effect), which is a meaningful result."
He also assessed the achievement of a growth rate in the 4% range, stating, "We firmly maintained our position as a top 10 global economic power consecutively in 2020 and 2021 amid the global pandemic, and the preliminary figure for per capita gross national income (GNI), to be announced in early March, is expected to show a significant increase for the first time in three years, reaching $35,000, marking a step forward."
He praised the composition of growth as well. He said, "Domestic consumption by our people has surpassed pre-crisis levels, corporate exports and investments recorded all-time highs, and fiscal policy played an active supporting role," adding, "This achievement is even more significant as it was accomplished through the united efforts of households, businesses, and the government."
However, he also expressed regret and concern that some sectors directly related to people's livelihoods have not yet recovered from the COVID-19 shock. He explained, "Face-to-face service industries, especially accommodation, food, and cultural services, have not yet fully recovered from the COVID-19 impact, and recent prolonged quarantine measures have exacerbated difficulties," adding, "Uncertainties surrounding our economy are also increasing, including the slowdown in growth of the G2 economies, prolonged global inflation, and concerns over accelerated shifts in major countries' monetary policies."
Deputy Prime Minister Hong continued, "This year, we must achieve complex goals such as stabilizing quarantine measures, boosting domestic demand, economic recovery, and price stability, so more precise and coherent economic policies are required than ever before," emphasizing, "Building on last year's achievements, we will have confidence in the resilience of our economy, but we will not be complacent and will devote all efforts toward stabilizing quarantine, promptly supporting small business owners through supplementary budgets, stabilizing prices and livelihoods, and ultimately aiming for 'complete economic normalization' within this year."
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