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South Korea’s economy posts highest growth rate in 11 years

South Korea’s economy

The 2021 growth rate marked the highest tally since 2010, when the economy expanded 6.8 percent

South Korea’s economy posted the highest growth rate in 11 years as consumption and exports bounced back from the pandemic-caused slump, central bank data showed Tuesday.

The gross domestic product is estimated to have grown four percent in 2021, marking a turnaround from a year earlier when the economy contracted 0.9 percent, the worst performance since 1998, Yonhap news agency reported data from the Bank of Korea (BOK) stated.

The 2021 growth rate marked the highest tally since 2010, when the economy expanded 6.8 percent. It also met the central bank’s annual growth outlook.

In November, the BOK predicted the country’s economy will grow four percent for 2021 and 3 percent in 2022. The central bank will announce its updated growth outlook next month, it said.

For the fourth quarter, the economy is estimated to have grown 1.1 percent, accelerating from the previous quarter’s 0.3 percent gain, the data showed.

South Korea has sought to bolster the economy, which has been hit hard by the coronavirus pandemic and toughened social distancing curbs, by expanding government spending, including two extra budgets and providing relief grants to people, according to Yonhap.

Facility investment gained 8.3 percent, compared with a 7.1 percent advance tallied a year earlier. Investment in construction, however, shrank 1.5 percent, worse than a 0.4 percent decline a year earlier.

It added that government spending rose 5.5 percent last year, higher than the previous year’s five percent gain.

Exports jumped 9.7 percent, bouncing back from a 1.8 percent contraction in 2020, driven by brisk overseas sales of semiconductors and oil-related products.

Imports also rose 8.4 percent, compared with a 3.3 percent decline registered a year earlier as purchases of crude oil increased, the data showed.

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