The ailing South Korean economy grew 2.6 percent in 2015, the lowest in three years, largely due to slumping exports and manufacturing, the central bank said Tuesday.
The nation’s fourth-quarter gross domestic product rose 0.6 percent from the previous three months, according to the Bank of Korea’s preliminary report.
“Private spending and investment in the construction sector expanded at a fast rate in 2015 and growth in facility investment was steady, but the exports and investment in intellectual property products were much slower,” the BOK said.
Korea’s gross domestic product growth marked 3.3 percent in 2014, 2.9 percent in 2013 and 2.3 percent in 2012.
The annual export growth fell to 0.4 percent from 2.8 percent in 2014 and 4.3 percent the year before. Growth in IP product investment fell to 1.4 percent, considerably lower than 4.6 percent in 2014 and 4.4 percent in 2013.
Private consumption grew 2.1 percent, up from the 1.8 percent in the previous year. Construction investments grew 4 percent, a large leap from the 0.6 percent growth from a year ago.
By economic activities, growth in manufacturing also slipped from 4 percent to 1.4 percent and services from 3.1 percent to 2.8 percent. Growth in the agriculture and fishing sector swung to minus 0.6 percent from 2.6 percent the previous year.
The country’s real gross domestic income -- used to gauge economic activity based on income -- grew 6.4 percent, by far surpassing GDP growth, largely as record-low global oil prices led to improvements in trade conditions.
As regards the fourth quarter, the central bank said that private consumption accelerated and export growth swung back to positive, yet the considerable fall in construction investments pulled down the overall quarterly growth.
In the October-December period, construction investments plummeted to minus 6.1 percent on-quarter from 5.0 percent. Facility investment was halved to 0.9 percent on-quarter from 1.8 percent.
During the same period, private consumption grew 1.5 percent from a quarter ago. Exports grew 2.1 percent from minus 0.6 percent and imports grew 2.8 percent.
The report came after the central bank on Dec. 14 slashed its growth outlook for 2016 to 3 percent from 3.2 percent, citing soaring household debt, volatility in the China market and low crude oil prices.
By Chung Joo-won (email@example.com