Seoul: South Korea’s economy is showing signs of improvement, driven by a rebound in consumer spending, though construction activity remains weak and export growth has slowed, according to the Korea Development Institute (KDI). Analysts see this as an early indication of South Korea’s economy recovery, even amid ongoing global uncertainties.
The KDI noted that while construction investment contracted and exports faced headwinds, consumption trends lifted overall economic momentum. Semiconductor exports, a key contributor to the nation’s trade, remained strong, rising 25.4% year-on-year in October to $15.73 billion — the highest ever recorded for the month.
Overall exports increased 3.6% from a year earlier to $59.57 billion, marking the fifth consecutive month of growth. However, the report highlighted slower growth in other sectors due to fewer working days during this year’s extended Chuseok holiday.
“Service output, particularly in domestic demand-driven sectors such as retail and wholesale, continues to recover,” the KDI said. Falling market interest rates and government stimulus measures are gradually easing the slowdown in private consumption.
Additionally, progress in U.S.-South Korea trade talks, including a finalized agreement on Seoul’s $350 billion pledge to lower U.S. tariffs, has provided a partial boost to exports. Despite this, KDI cautioned that uncertainties remain due to global trade tensions and ongoing economic fluctuations.
Experts see these indicators as positive signals that South Korea’s economy recovery is gaining traction, though challenges in construction and non-semiconductor exports may temper growth in the coming months.
–IANS
