By Cynthia Kim
SEOUL (Reuters) – South Korea’s economy grew at a faster-than-expected pace in the fourth quarter as it ended the coronavirus-stricken year solidly poised for a recovery in 2021 thanks to surging exports.
Gross domestic product (GDP) grew a seasonally adjusted 1.1% in the December quarter from the September quarter, the Bank of Korea said on Tuesday, faster than the median estimate of 0.7% in a Reuters poll and following a 2.1% expansion in the September quarter.
That limited the contraction over the whole year to 1.0%, which is likely to be the smallest GDP slump among the Organization for Economic Co-operation and Development in the year of the pandemic that killed more than 2 million worldwide.
South Korea’s economy has been rebounding sharply since the second quarter when it experienced its sharpest downturn since 2008. But the recovery from the virus-hit downturn has been uneven.
December exports surged 12.6% from a year earlier, the sharpest expansion in 26 months.
But the number of jobs plunged at the sharpest rate in over two decades in December, a sign the recovery is still fragile amid the third wave of the coronavirus now sweeping the country.
Data on Tuesday showed exports jumped 5.2% in the fourth quarter from three months earlier, which helped offset a 1.7% decline in private consumption because of toughened COVID-19 social-distancing measures since late last year.
Construction investment jumped 6.5% from a quarter earlier, logging the best performance since the fourth quarter of 2019.
On a year-on-year basis, the economy shrank 1.4% in the fourth quarter, less than the 1.7% decline forecast in the poll.
(Reporting by Cynthia Kim; Editing by Peter Cooney)
