South Korea's manufacturing industry saw its added value shrink at the fastest clip in 21 years in 2019 on falling prices of chips and other key products, government data showed Friday.

The added value of the country's manufacturing and mining sectors came to 559.8 trillion won ($507 billion) last year, down 1.4 percent from a year earlier, according to the data from Statistics Korea.

It was the largest annualized contraction since the 2.1 percent fall recorded in 1998 in the wake of the country's foreign exchange crisis.

South Korea had suffered on-year decreases in the manufacturing sector's added value only twice -- in 1998 and 2013 -- since the start of data tracking in 1967.

Added value refers to the difference between a product's selling price and the direct and indirect input used to make it.

The agency attributed last year's drop to fallen prices of semiconductors, electronic goods and chemical products, along with slumping crude prices.

The local chip industry saw its added value plunge by 4.3 trillion won last year from 2018 due to falling prices.

The data also showed the value of products shipped by the manufacturing industry declined 1.4 percent on-year to 1,545.7 trillion won last year, with its workforce dropping 0.9 percent to 2.94 million. (Yonhap)