SEOUL, Jan. 26 (Xinhua) -- South Korea's economy posted the first contraction in 22 years last year on the back of the COVID-19 pandemic, central bank data showed Tuesday.

Real gross domestic product (GDP), adjusted for inflation, contracted 1.0 percent in 2020 from a year ago, according to the Bank of Korea (BOK).

It marked the first decline since 1998 when the real GDP tumbled 5.1 percent amid the foreign exchange crisis. The country's first-ever GDP reduction was tallied in 1980 when the real GDP slipped 1.6 percent.

The 2020 result was believed to have surpassed other major economies. According to the Organization for Economic Cooperation and Development (OECD) estimates, the economies of the United States, Japan, Germany, France and Britain were believed to have declined 3.7 percent, 5.3 percent, 5.5 percent, 9.1 percent and 11.2 percent respectively in 2020.

The COVID-19 pandemic across the world weakened both export and consumers spending of South Korea.

Export, which accounts for about half of the export-driven economy, diminished 2.5 percent last year, marking the first fall in 11 years.

Private consumption dived 5.0 percent in 2020, logging the biggest yearly slide since 1998.

The fiscal expenditure advanced 5.0 percent as the government unveiled four supplementary budget schemes worth over 300 trillion won (270 U.S. dollars) last year to tackle the economic fallout from the pandemic.

Facility investment went up 6.8 percent in 2020, after skidding 7.5 percent in the previous year.

Import retreated 3.8 percent last year, logging the biggest fall in 11 years since 2009. Investment in the construction sector dipped 0.1 percent in 2020, after reducing 2.5 percent in 2019.

Despite the negative GDP growth in the whole year of 2020, the economy rebounded in the second half.

The real GDP grew 1.1 percent in the fourth quarter from the prior quarter, after expanding 2.1 percent in the third quarter. It went down 1.3 percent in the first quarter and 3.2 percent in the second quarter.

The country's export advanced 5.2 percent in the fourth quarter, after jumping 16.0 percent in the third quarter due to a partial recovery in global demand.

Import gained 2.1 percent in the fourth quarter on a quarterly basis, after increasing 5.6 percent in the third quarter.

Private consumption fell 1.7 percent in the fourth quarter from the previous quarter amid the COVID-19 resurgence here.

The consumer spending dipped 6.5 percent in the first quarter, before rebounding 1.5 percent in the second quarter. It was unchanged in the third quarter from the prior quarter.

Facility investment reduced 2.1 percent in the fourth quarter, after picking up 8.1 percent in the third quarter.

Investment in the construction sector grew 6.5 percent in the fourth quarter, after dropping 7.3 percent in the prior quarter. Enditem

Related

Go to Forum >>0 Comment(s)