Latest News:  


S. Korean growth accelerates in 4Q as strong won boosts consumption

By Yoo Seungki (Xinhua)

13:45, January 24, 2013

SEOUL, Jan. 24 (Xinhua) -- South Korea's economic growth accelerated in the fourth quarter from three months earlier, after rising 0.1 percent in the prior three months, as stronger won helped boost private consumption.

Real gross domestic product (GDP), the broadest measure of economic performance, increased 0.4 percent in the three months ended Dec. 31, up from a revised 0.1 percent growth in the third quarter, the Bank of Korea (BOK) said in a statement on Thursday. The figure was seasonally adjusted.

Private consumption rose 0.8 percent, offsetting reduction in other items of the expenditure side such as exports, imports and facility investment. The won's ascent against the U.S. dollar enhanced purchasing power of domestic consumers, resulting in consumption growth.

"To some extent, import prices fell after the won/dollar exchange rate declined," Kim Young Bae, director general of the BOK's economic statistics department, said on the sidelines, replying to whether private consumption was boosted by stronger won.

For the whole year of 2012, the economy grew 2 percent from a year earlier, the lowest in three years. Exports and consumption grew at a slower pace, and facility investment posted a minus growth last year.


South Korean Finance Minister Bahk Jae-wan said Wednesday that the country is ready to tackle the won's ascent against the greenback, strongly hinging that another measure to ease volatility in the won/dollar rate would come in the foreseeable future. Bahk noted that "preparations for additional market stabilization measures have been completed."

South Korea has raised its worrying voice over side effects from stronger won as the accelerating won's ascent will damp the export-driven economy. The finance ministry said in a report that the won's appreciation against the dollar will cause worsening profitability of export companies in the short term, while weakening export competitiveness amid higher export prices in the long run.

The won rallied 7.58 percent versus the greenback in 2012 due to quantitative easing by central banks in major economies and the relatively solid fundamentals of the country. The local currency surged almost 20 percent to the Japanese yen as expectations for expansionary monetary policy spread under the new government in Japan.

Amid the stronger won, exports of goods and services declined 1. 2 percent in the fourth quarter from the prior quarter. Imports retreated 1.1 percent amid higher commodity prices, and facility investment sank 2.8 percent on weak demand for semiconductor equipments.

"The won/dollar exchange rate is assessed to have no material impact on the 4Q GDP figure. It remains to be seen whether the rate will affect the reading," Kim at the BOK told reporters.

【1】 【2】

We recommend:

Report on the rich in China released

Sales boosting measures for Spring Festival

1st express sleeper train starts operation

Top 10 most transparent multinational companies

Top Ten Economic Events in 2012

Beijing leads nation on rich list


Leave your comment0 comments

  1. Name


Selections for you

  1. PLA hold actual-troop campaign exercise

  2. Carrier-based aircraft unit in tactical training

  3. The happiest places in the world

  4. Time to stop waste on dining table

  5. Photos: Amazing China in 1950s

  6. Building on bridge triggers debate

  7. Reviving the lost art of making silk parasols

  8. Backstreet Boys to start world tour

  9. Software maker shows its dexterity

  10. Celebrities gone wild!

Most Popular


  1. Will Americans be fans of Chinese TV drama?
  2. US should not put new burden on itself
  3. The fiscal cliff and the 'gun cliff'
  4. New measurement may reshape Sino-U.S. trade ties
  5. Warning issued on global economy
  6. The 'artificialness' in Chinese movies
  7. China to ensure appearance of witnesses in court
  8. Competition about to heat up for public funds
  9. Huawei deserves a fair playing field in US

What’s happening in China

Going back home: A standing journey

  1. 'I lost my only child…'
  2. Can Chinese save face and save money?
  3. Overseas funding for nursing homes welcomed
  4. Police suspended amid official's property scandal
  5. Mummified bodies found in Beijing flat