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South Korea Launches Record 2026 Budget for Tech and Defense Growth
South Korea unveiled a record KRW 728 trillion budget plan for 2026, marking an 8.1% increase from this year, more than triple the pace of 2025’s rise. The expansion, aimed at reviving an economy strained by U.S. tariffs, rising welfare costs, and demographic pressures, will be financed partly through a record KRW 232 trillion bond issuance, the finance ministry noted. President Lee Jae Myung’s government said the spending will drive an “economic transformation,” channeling support into AI, semiconductors, shipbuilding, and K-culture, while fostering small businesses and regional growth. Defense outlays will climb 8.3% to KRW 66.3 trillion, funding advanced weapons, drones, and responses to North Korean threats. While President Trump has pressed U.S. allies to raise defense spending, officials said talks with Washington are ongoing, noting the increase would bring defense spending to about 2.4% of GDP.
Published on 2025-08-29

South Korea to Lift 2026 Spending Sharply with Focus on AI Growth
South Korea plans its biggest budget increase in four years as President Lee Jae Myung pushes expansionary fiscal policy to spur growth, with a strong focus on artificial intelligence. The finance ministry said on Friday that government spending for 2026 will rise 8.1% to KRW 728 trillion, compared with a 2.5% gain this year. It marks the steepest jump since 2022, excluding two supplementary budgets already introduced in 2025. Lee, who took office on June 4, has pledged to boost investment and growth, diverging from his conservative predecessor Yoon Suk Yeol, who emphasized fiscal discipline. The new spending plan follows last week’s unveiling of broader economic measures prioritizing AI investment, as the government downgraded growth forecasts due to pressure from U.S. tariffs and the nation’s demographic challenges.
Published on 2025-08-29

South Korea to Lift 2026 Spending Sharply with Focus on AI Growth
South Korea plans its biggest budget increase in four years for next year, as President Lee Jae Myung pushes expansionary fiscal policy to spur growth, with a strong focus on artificial intelligence. The finance ministry said on Friday that government spending for 2026 will rise 8.1% to KRW 728 trillion, compared with a 2.5% gain this year. It marks the steepest jump since 2022, excluding two supplementary budgets already introduced in 2025. Lee, who took office on June 4, has pledged to boost investment and growth, diverging from his conservative predecessor Yoon Suk Yeol, who emphasized fiscal discipline. The new spending plan follows last week’s unveiling of broader economic measures prioritizing AI investment, as the government downgraded growth forecasts due to pressure from U.S. tariffs and the nation’s demographic challenges.
Published on 2025-08-29

South Korea to Lift 2026 Spending Sharply with Focus on AI Growth
South Korea plans its biggest budget increase in four years for 2026, as President Lee Jae Myung pushes expansionary fiscal policy to spur growth, with a strong focus on artificial intelligence. The finance ministry said on Friday that government spending for 2026 will rise 8.1% to KRW 728 trillion, compared with a 2.5% gain this year. It marks the steepest jump since 2022, excluding two supplementary budgets already introduced in 2025. Lee, who took office on June 4, has pledged to boost investment and growth, diverging from his conservative predecessor Yoon Suk Yeol, who emphasized fiscal discipline. The new spending plan follows last week’s unveiling of broader economic measures prioritizing AI investment, as the government downgraded growth forecasts due to pressure from U.S. tariffs and the nation’s demographic challenges.
Published on 2025-08-29

South Korea Launches Record 2026 Budget for Tech and Defense Growth
South Korea unveiled a record KRW 728 trillion budget plan for 2026, marking an 8.1% increase from this year, more than triple the pace of 2025’s rise. The expansion, aimed at reviving an economy strained by U.S. tariffs, rising welfare costs, and demographic pressures, will be financed partly through a record KRW 232 trillion bond issuance, the finance ministry noted. President Lee Jae Myung’s government said the spending will drive an “economic transformation,” channeling support into AI, semiconductors, shipbuilding, and K-culture, while fostering small businesses and regional growth. Defense outlays will climb 8.3% to KRW 66.3 trillion, funding advanced weapons, drones, and responses to North Korean threats, with lessons drawn from Russia’s war in Ukraine. While President Trump has pressed U.S. allies to raise defense spending, officials said talks with Washington are ongoing, noting the increase would bring defense spending to about 2.4% of GDP.
Published on 2025-08-29

South Korea 2021 GDP Growth at 11-Year High
South Korea’s economy expanded at the fastest pace in 11 years at 4% for the full-year 2021 amid a strong demand for exports, matching the advance estimates. Meanwhile, the fourth quarter annual GDP growth rate was revised 0.1 percentage points higher to 4.2%, faster than the 4% annual increase in the previous quarter and higher than the 3.7% consensus forecast. Both private consumption (6.3% vs 3.3% in Q3) and government consumption (8.1% vs 6.5%) improved on an annual basis from the previous quarter. However, fixed investment (1.1% vs 1.5% in Q3) increased at a slower pace, weighed down by lower construction investments (-1.7%). Net trade also failed to contribute significantly to growth in Q4, with exports growth (6.1%) lagging behind imports growth (9.7%).
Published on 2022-03-03

South Korea 2021 GDP Growth at 11-Year High
South Korea’s economy expanded at the fastest pace in 11 years at 4% for the full-year 2021, driven by strong demand for exports. Meanwhile, the fourth quarter annual GDP growth rate was at 4.1%, faster than the 4% annual increase in the previous quarter and higher than the 3.7% consensus forecast. Both private consumption (6.3% vs 3.3% in Q3) and government consumption (8.1% vs 6.5%) improved on an annual basis from the previous quarter. However, fixed investment (1.1% vs 1.5% in Q3) increased at a slower pace, weighed down by lower construction investments (-1.7%). Net trade also failed to contribute significantly to growth in Q4, with exports growth (6.1%) lagging behind imports growth (9.7%).
Published on 2022-01-25

South Korea Q3 GDP Annual Growth Rate at 4%
South Korea’s economy expanded 4% year-on-year in the third quarter of 2021, slowing from a decade-high 6% growth in the preceding quarter and lower than consensus forecast of a 4.2% rise. The latest data was consistent with figures given in the advance estimate. Both private consumption (3.3% vs 3.7% in Q2) and fixed investment (1.5% vs 3.8%) increased at a slower pace, weighed down by a resurgence in Covid-19 cases triggered by the Delta variant. On the other hand, government spending picked up (6.5% vs 5.3%). Meanwhile, net trade contributed significantly to growth with exports (7.2% vs 22.4% in Q2) rising faster than imports (6.6% vs 13.7%). On a quarterly basis, the GDP increased 0.3%, after growing 0.8%in the prior period and missing market estimates of a 0.6% rise.
Published on 2021-12-01

South Korea GDP Growth Slows More than Expected
South Korea’s economy advanced by 4 percent year-on-year in the third quarter of 2021, slowing from a 6 percent expansion in the previous period, which was the fastest in a decade, a preliminary estimate showed. It compares with market consensus of a 4.2 percent rise. Both private consumption (3.2 percent vs 3.7 percent in Q2) and fixed investment (1.8 percent vs 3.8 percent) increased at a slower pace, weighed down by a resurgence in Covid-19 cases triggered by the Delta variant. On the other hand, government spending picked up (6.3 percent vs 5.3 percent). Meanwhile, net trade contributed significantly to growth with exports (6.9 percent vs 22.4 percent in Q2) rising faster than imports (6.7 percent vs 13.7 percent). On a quarterly basis, the GDP increased 0.3 percent, after growing 0.8 percent in the prior period and missing market estimates of a 0.6 percent rise.
Published on 2021-10-25

South Korea GDP Revised Higher in Q2
South Korea’s economy advanced 6 percent year-on-year in the second quarter of 2021, following a 1.9 percent rise in the previous period and slightly higher than a preliminary estimate of 5.9 percent. It was the fastest expansion since the last quarter of 2010, partly due to the low base effect last year, but also due to a positive contribution from trade, as exports jumped 22.4 percent and imports rose 13.7 percent. At the same time, both private consumption (3.7 percent vs 1.2 percent in Q1) and government spending (5.3 percent vs 2.3 percent) increased at a faster pace. Gross fixed capital formation also expanded solidly overall (3.8 percent vs 4 percent). On a quarterly basis, Asia's fourth-largest economy advanced 0.8 percent, following a 1.7 percent gain in the previous quarter.
Published on 2021-09-01

South Korea GDP Grows Most Since 2010
South Korea’s economy advanced 5.9 percent year-on-year in the second quarter of 2021, accelerating from a 1.9 percent expansion in the previous period, and compared to market consensus of a 6.0 percent expansion, a preliminary estimate showed. It was the fastest expansion in a decade, as both private consumption (3.6 percent vs 1.2 percent in Q1) and government spending (5.3 percent vs 2.3 percent) increased at a faster pace. Net trade contributed positively to growth, as exports jumped 22.4 percent (from 5.1 percent in Q1) while imports surged 13.7 percent (from 4.1 percent in Q1). On the other hand, gross fixed capital formation expanded at a softer rate (4.0 percent vs 3.6 percent). On a quarterly basis, Asia's fourth-largest economy advanced 0.7 percent, following a 1.7 percent gain in the previous quarter.
Published on 2021-07-26

South Korea GDP Revised Higher in Q1
South Korea’s economy advanced 1.9 percent year-on-year in the first quarter of 2021, rebounding from a 1.1 percent contraction in the previous period and higher than a preliminary estimate of 1.9 percent. Private consumption rebounded (1.2 percent vs -6.6 percent in Q4) while government spending rose at the same pace as in the prior quarter (2.3 percent). Also, gross fixed capital formation expanded at a much faster rate (4.0 percent vs 1.3 percent). Net trade contributed positively to growth, as exports jumped 5.1 percent (from 2.3 percent in Q4) while imports increased 4.1 percent (from -1.3 percent in Q4). On a quarterly basis, Asia's fourth-largest economy advanced 1.7 percent, following a revised 1.1 percent gain in the previous quarter.
Published on 2021-06-08

South Korea Economy Rebounds
South Korea’s economy advanced 1.8 percent from a year earlier in the first quarter of 2021, following a 1.2 percent contraction in the previous period and compared to market consensus of a 1.1 percent expansion, a preliminary estimate showed. Private consumption rebounded (1.0 percent vs -6.5 percent in Q4) while government spending increased faster (2.6 percent vs 2.3 percent). Also, gross fixed capital formation expanded at a much faster rate (3.7 percent vs 1.2 percent). Net trade contributed positively to growth, as exports jumped 4.5 percent (from 1.2 percent in Q4) while imports increased 3.1 percent (from -2.8 percent in Q4). On a quarterly basis, Asia's fourth-largest economy advanced 1.8 percent, following a 1.2 percent contraction in the previous quarter.
Published on 2021-04-26

South Korea GDP Shrinks Less than Earlier Estimated
South Korea’s Gross Domestic Product (GDP) contracted 1.2% on an annual basis in the last three months of 2020, compared to a 1.1% expansion in the prior period and to a preliminary estimate of a 1.4% drop. By sector, construction sank 3.2% after contracting 1.9% in Q3, while services also fell further (-1.8% vs -1.3%). In contrast, utilities continued to rise solidly by 8.0% after growing 8.7%. Manufacturing advanced 0.3%, recovering from a 0.7% decrease in the previous period. On a quarterly basis, the GDP rose 1.2 percent, following a 2.1 percent advance in the previous quarter, as the recovery lost momentum. Asia's fourth-largest economy contracted 1 percent in 2020, unchanged from the bank's earlier estimate. It was the first annual contraction since 1998, when South Korea was in the midst of a crippling financial crisis.
Published on 2021-03-03

South Korea Annual GDP Falls Further
South Korea’s Gross Domestic Product (GDP) contracted 1.4 percent on an annual basis in the last three months of 2020, compared to a 1.1 percent expansion in the previous period and to market expectations of a 1.7 percent drop, preliminary data showed. By sector, construction sank 2.8 percent after contracting 1.9 percent, while services also fell further (-2.1 percent vs. -1.3 percent). In contrast, utilities expanded 9.2 percent and gained steam after growing 8.7 percent. Manufacturing edged up 0.1 percent after declining 0.7 percent. On a quarterly basis, GDP expanded 1.1 percent following a 2.1 percent advance in the previous quarter, as the recovery lost momentum.
Published on 2021-01-25

South Korea GDP Contracts 1.1% YoY in Q3
South Korea’s GDP contracted a downwardly revised 1.1 percent on an annual basis in the third quarter of 2020 following a 2.7 percent contraction in the previous period and compared to a preliminary 1.3 percent decline. On the expenditure side, consumption dropped further (-2.1 percent vs -1.3 percent in Q2), whereas gross fixed capital formation gained steam (3.2 percent vs 1.9 percent). Exports declined 3.4 percent (vs -13 percent), whereas imports sank 4.6 percent (vs -8.5 percent). On a quarterly basis, activity rebounded 2.1 percent quarter over quarter in the three months to September after shrinking 3.2 percent quarter in the previous period, beating the preliminary estimate of a 1.9 percent increase.
Published on 2020-11-30

South Korea GDP Falls 1.3% YoY
South Korea’s GDP contracted 1.3 percent on an annual basis in the third quarter of 2020 following a 2.7 percent contraction in the previous period, preliminary data showed. On the expenditure side, consumption dropped further (-2.3 percent vs -1.3 percent in Q2), whereas gross fixed capital formation gained steam (2.6 percent vs 1.9 percent). Exports declined 3.7 percent (vs -13 percent), whereas imports sank 5.3 percent (vs -8.5 percent). On a quarterly basis, activity rebounded 1.9 percent quarter over quarter in the three months to September after shrinking 3.2 percent quarter in the previous period, beating expectations of a 1.7 percent increase.
Published on 2020-10-26

South Korea Annual GDP Contracts 2.7% YoY
South Korea’s GDP contracted 2.7 percent on an annual basis in the second quarter of 2020 following a 1.4 percent expansion in the previous period, final data showed. On the expenditure side, consumption dropped 1.3 percent after declining 1.7 percent, dragged by private spending (-4 percent). Meanwhile, gross fixed capital formation expanded 1.9 percent following a 4.7 percent increase. Exports fell 13.5 percent, while imports dropped 8.5 percent. On the production side, manufacturing dropped 6.6 percent (vs 3.5 percent in Q1), while utilities posted nil growth (vs 7.2 percent in Q1) and construction contracted 0.2 percent (vs 3 percent in Q1). On a quarterly basis, the GDP contracted 3.2 percent and was revised 0.1 pp higher.
Published on 2020-08-31

South Korea Economy Shrinks the Most since 1998
South Korea's gross domestic product contracted 2.9 percent year-on-year in the second quarter of 2019, reversing a 1.4 percent growth in the previous three-month period and steeper than a 2.0 percent decline predicted by analysts, a preliminary estimate showed. It was the worst contraction since the last quarter of 1998, as exports plunged 13.6 percent due to worldwide coronavirus-induced lockdowns and economic shutdown. Imports went down 9.2 percent. Meanwhile, private spending shrank 4.1 percent, public spending rose 6 percent and gross fixed capital formation increased 1.1 percent.
Published on 2020-07-22

South Korea GDP Annual Growth at 1.4% YoY in Q1
The South Korean economy advanced 1.4% year-on-year in the first quarter of 2020, following a 2.3% expansion in the previous period and compared to a preliminary estimate of 1.3%. Still, it was the softest expansion since the Q3 of 2009, mainly due to a slowdown in services growth (0.2% vs 3.2% in Q4). On the other hand, activity strengthened in manufacturing (3.5% vs 1.7%); utilities (7.2% vs -0.7%) and construction (3% vs 1.2%). On the expenditure side, private consumption fell 4.8% (vs 1.9%), while government spending rose 6.8% (vs 6.5%) and gross fixed investment climbed 4.7% after rising 1.4% in the prior period. Meantime, exports advanced 5.6% (vs 3.7% in Q4) and imports went up 0.9% (vs 1.2% in Q4). On a quarterly basis, GDP declined a revised 1.3% in the three months to March 2020, the most since the last quarter of 2008, after increasing 1.3% in the prior period. The economy is expected to contract 0.2% in 2020, before recovering 3.1% in 2021.
Published on 2020-06-01