The Bank of Korea announced that South Korea's gross domestic product (GDP) rose by a seasonally adjusted 0.6 percent in the last quarter of 2023, maintaining the same pace as the previous quarter. This surpassed the predicted increase of 0.5 percent. Additionally, the real gross domestic income (GDI) saw an uptick of 0.4 percent during the same period.
On the expenditure front, private consumption saw a small rise of 0.2 percent due to increased final consumer expenditure by resident households abroad, although there was a decrease in spending on goods. In contrast, Government consumption experienced a higher increase of 0.4 percent, attributed to heightened expenditures on goods and social security-related benefits, such as healthcare.
Investments in the construction sector, however, fell significantly by 4.2 percent due to a decrease in building construction and civil engineering. Conversely, facilities investment surged by 3.0 percent, largely due to an increase in transportation equipment investment.
The export sector saw an encouraging 2.6 percent climb, spearheaded by a surge in semiconductor exports, and imports registered a more modest 1.0 percent growth, driven by a surge in petroleum products imports.
On the production side, the agriculture, forestry and fishing industry saw a significant dip of 6.1 percent, primarily due to lower crop yields, while manufacturing rose by 1.1 percent following an increase in computer, electronic, and optical products. Gas, electricity, and water supply sector saw a significant increase of 11.1 percent due to increased electricity production, despite the construction sector seeing a 3.6 percent fall. The service sector saw a modest 0.6 percent growth spearheaded by an increase in business activities and human health and social work, even with a decrease in finance and insurance activities.
Annually, GDP saw an increase of 2.2 percent, beating the 2.1 percent forecast and accelerating from 1.4 percent in the preceding three months. Overall, in 2023, South Korea's GDP saw a 1.4 percent increase.
Looking at the entirety of the previous year, the expenditure front saw the growth of both construction and facilities investment, albeit the growth of private consumption, government consumption, exports, and imports slowed. On the production side, the growth of the construction sector expanded, while manufacturing and services sector growth decelerated.
The real GDI expanded by 1.4 percent over the previous year, keeping pace with real GDP, as the terms of trade remained consistent with the previous year's level.
