Published : Dec. 3, 2015 - 19:50
South Korea’s economy grew at the fastest rate in five years in the third quarter, boosted by a recovery in consumption and rebound in the construction industry, central bank data showed Thursday.
The nation’s gross domestic product rose 1.3 percent from the previous quarter, the highest since the 1.7 percent recorded in the second quarter of 2010, according to the Bank of Korea.
This was a slight increase from the original estimate of 1.2 percent, as well as the first time in five quarters that the figure exceeded the 1-percent level.
The improved figure reflects a recovery in consumer spending, which reeled in the aftermath of the Middle East respiratory syndrome outbreak in late May and June this year. The MERS spread resulted in the deaths of 38 people, and led the government to lower its growth forecast to 3.1 percent from 3.8 percent.
The GDP growth in the third quarter was the most conspicuous in the construction sector which showed a 5.6 percent on-quarter growth.
The manufacturing industry, however, only grew by 0.1 percent during the same period due to faltering exports, which have been hit by the slower growth in China, its largest trade partner.
The gross national income rose 1.4 percent on-quarter to 381.1 trillion won ($327 billion), once again showing an upturn, according to the BOK.
“The GNI growth is the combined result of the GDP increase and net factor income from overseas,” said an official of the economic statistics bureau at the central bank.
The net factor income from overseas -- indicating the total overseas income of Korean nationals minus the income of foreigners in Korea -- was 3.3 trillion won in the third quarter, up from 1.3 trillion won in the previous quarter.
The data showed that other indicators such as the savings rate and the investment rate also rose, by 0.3 percent and 0.8 percent, respectively, from the previous quarter.
The overall boost in the economy was driven by a prolonged trend of low interest rates and the consequent surge in consumption. The nation’s key interest rate has been set at an all-time low of 1.5 percent since June this year.
By Bae Hyun-jung (
tellme@heraldcorp.com)