The Bank of Korea announced on Tuesday that South Korea's gross domestic product (GDP) experienced a seasonally adjusted growth of 0.6 percent in the fourth quarter of 2023, which was consistent with expectations and matched the previous quarter's results.
The nation's real gross national income (GNI) recorded a slower growth pace of 0.1 percent quarterly, a deceleration from the 1.6 percent rise in the third quarter.
From a production perspective, a significant driver of this growth was the manufacturing sector, which saw a 1.2 percent increase primarily due to an uptick in the production of computer, electronic, and optical products. However, the construction sector witnessed a decline of 3.8 percent as a result of decreased building construction.
Growth in the services sector was marked at 0.8 percent, led by transportation, storage, human health, and social work. Interestingly, the finance and insurance services underwent a reduction.
Delving into expenditure, private consumption experienced a modest growth of 0.2 percent due to an increase in final consumption expenditure of resident households abroad, despite a decrease in expenditure on goods. Government consumption rose by 0.5 percent due to escalated expenditures on goods.
In contrast, construction investment dipped by 4.5 percent due to declining building construction. However, facility investment grew by 3.3 percent, propelled by an uptick in investment in transportation equipment.
Exportation witnessed a healthy 3.5 percent growth, keyed by increased semiconductor exports, while imports grew by 1.4 percent, mainly due to an influx of petroleum products.
On an annualized basis, the GDP posted a growth of 2.2 percent, in line with forecasts and an acceleration from the 1.4 percent growth seen in the previous three-month period.
The nominal GNI recorded a 1.5 percent increase in the fourth quarter of 2023 compared to the previous quarter, falling slightly behind the growth rate of nominal GDP. This is attributed to a decrease in net factor income from the rest of the world.
Real GNI experienced a slight growth of 0.1 percent compared to the preceding quarter, below that of real GDP, as real trading losses increased and as the real net factor income from the rest of the world decreased. The GDP deflator saw a year-on-year rise of 3.5 percent.
For the entire year of 2023, the overall GDP growth was 1.4 percent, a slower rate compared to the 2.6 percent growth in 2022.
In terms of expenditure, construction and facilities investment showed positive growth, while the growth rates of private consumption, government consumption, exports, and imports slowed down.
From a production perspective, both manufacturing and services sectors experienced slowed growth, but construction saw an expansion.
Lastly, the real GNI for the year increased by 1.8 percent, owing to an increase in the real net factor income from the rest of the world.
