Semiconductor and Export Recovery Drive 0.6% Growth Rate in Q3... Maintaining Positive Growth

Private Consumption Up 0.3%, Government Consumption Up 0.2%... Facility Investment Down 2.2%

South Korea's economy grew by 0.6% in real gross domestic product (GDP) in the third quarter of this year, driven by a recovery in the semiconductor industry.

On the 5th, the Bank of Korea announced that the real GDP growth rate for the third quarter of this year (preliminary figure, quarter-on-quarter) was 0.6%, the same as the flash estimate released on October 26.

The quarterly growth rates showed positive growth for three consecutive quarters, with 0.3% in the first quarter, 0.6% in the second quarter, and continuing into the third quarter. The Bank of Korea expects to achieve a 1.4% growth rate for this year in its November revised economic outlook.

Looking at the third quarter growth rate by sector, facility investment decreased, but construction investment increased.

Private consumption rose by 0.3%, mainly driven by service consumption such as entertainment, culture, food, and accommodation. This marked a turnaround from a 0.1% decline in the second quarter.

Government consumption increased by 0.2% due to a rise in social security in-kind benefits such as health insurance benefits.

Construction investment increased by 2.1%, with both building construction and civil engineering construction rising.

Facility investment decreased by 2.2%, mainly due to a decline in machinery.

Exports increased by 3.4%, centered on semiconductors, machinery, and equipment, while imports rose by 2.3%, mainly due to petroleum products.

By economic activity, electricity, gas, and water supply decreased, but manufacturing and construction showed growth.

Agriculture, forestry, and fisheries increased by 1.5%, mainly driven by livestock farming, and manufacturing grew by 1.4%, with increases in computers, electronics, and optical equipment.

Electricity, gas, and water supply decreased by 0.5% compared to the previous quarter. Construction increased by 2.3%, with growth in building and civil engineering construction.

Services increased by 0.3%, despite declines in wholesale and retail trade and accommodation and food services, due to growth in culture and other services.

The nominal gross national income (GNI) in the third quarter rose by 0.5% compared to the previous quarter. However, nominal net income from abroad decreased significantly from 13.7 trillion won to 4.8 trillion won, causing the nominal GDP growth rate (2.2%) to be outpaced.

Export containers are being loaded onto a ship at Busan North Port. Photo by Jinhyung Kang aymsdream@