South Korea’s economy grew at its slowest pace for three years in 2012, as the global downturn dampened exports and domestic demand, the central bank said on Thursday.
Asia’s fourth largest economy grew by 2.0 percent over the previous year — the slowest pace since a 0.3 expansion in 2009.
The preliminary figure from the Bank of Korea showed a slight acceleration in the fourth quarter, with gross domestic product up 0.4 percent from the July-September period.
Exports, however, which account for nearly half the national GDP, slipped 1.2 percent from the third quarter due to falling shipments of machinery and ship vessels.
On a yearly basis, the economy grew 1.5 percent in October-December compared to the fourth quarter of 2011 and exports were up 4.0 percent.
Corporate investment in infrastructure slid 2.8 percent from the previous quarter and 5.1 percent from a year earlier, while construction investment was down 1.3 percent from the previous quarter and 4.1 percent from a year ago.
The 2.0 percent growth figure for the whole of 2012 fell short of the central bank’s prediction of 2.4 percent.
The South’s economy expanded 6.3 percent in 2010 and 3.6 percent in 2011.
“Despite signs of a recovery in exports and private consumption, weak corporate investment due to volatile forex moves and the sluggish property market will undercut growth, making the economy expand below trend for some time,” Tongyang Securities economist Lee Cheol-Hee told Dow Jones Newswires.
Consumer spending inched up 1.8 percent in 2012 compared to 2.3 percent the previous year.
South Korea, with an export-led economy, tends to mirror the fortunes of the region, and its GDP numbers are often a harbinger of broader trends in Asia.
– Dow Jones Newswires contributed to this report –
S.Korea economic growth at three-year low in 2012
