SEOUL, Oct. 26 (Xinhua) — South Korea’s gross domestic product (GDP) growth hit the highest in over seven years thanks to robust recovery of exports, which account for about half of the export-driven economy, central bank data showed Thursday.
The seasonally-adjusted real GDP was 392.07 trillion won (348.45 billion U.S. dollars) in the July-September quarter, up 1.4 percent from the previous three-month period, according to the Bank of Korea (BOK).
It marked the fastest expansion since the second quarter of 2010, more than doubling a 0.6 percent increase tallied in the prior quarter.
From a year earlier, the real GDP advanced 3.6 percent in the third quarter, posting the highest growth in 14 quarters.
This year’s economic growth was expected to surpass the outlooks unveiled by both the government and the BOK.
Earlier this month, the central bank revised up its 2017 growth forecast to 3 percent, or an identical figure estimated by the government.
After peaking at 3.3 percent in 2014, the country’s GDP growth rate stood at 2.8 percent both in 2015 and 2016.
The quarter-over-quarter GDP growth rate fell from 1.1 percent in the first quarter of this year to 0.6 percent in the second quarter, before rebounding to 1.4 percent in the third quarter.
The third-quarter rebound was led by exports, which jumped 6.1 percent from three months earlier.
In September alone, the country’s exports hit the largest-ever monthly figure of 55.13 billion dollars. The exports kept an upward momentum for the 11th consecutive month.
Imports rose 4.5 percent in the September quarter on higher import prices for chemical products and crude oil.
Fiscal spending also helped boost the economic recovery. Fiscal expenditure gained 2.3 percent, logging the highest rise since the first quarter of 2012. The government allocated 11.2 trillion won (about 10 billion dollars) to the second-half supplementary budget.
The Moon Jae-in government, which was inaugurated in May, set its key goal of economic policy at “income-driven growth” to help ordinary people have sufficient money to spend by creating decent jobs and reducing a wage gap between regular and irregular workers and between employees hired by big and small companies.
The Moon administration raised the minimum wage by a double digit, promising to turn hundreds of thousands of irregular workers in the public sector into regular employees.
Construction investment rose at a relatively low pace of 1.5 percent as the government announced a set of measures to control speculative investment in the real estate market and curb mortgage loans.
Facility investment inched up 0.5 percent in the quarter, recording the lowest since the first quarter of last year. But it jumped 16.8 percent compared with the same quarter last year.
Private consumption rose 0.7 percent in the September quarter, after growing 1 percent in the previous quarter.
Despite the overall recovery led by robust exports, consumers here refrained from spending money amid remaining uncertainties, such as geopolitical risks on the Korean Peninsula and massive household debts.
Tensions ran high on the peninsula after the Democratic People’s Republic of Korea (DPRK)’s sixth and most powerful nuclear test in September and multiple test-launches of ballistic missiles in recent months.
Debt-servicing burden for households was feared to increase in the near future amid widespread expectations that the BOK could raise its record-low policy rate within this year.