Economic Growth Rate
Q3’s economic growth rate showed a surprising “growth spurt,” improving 1.1% compared to the previous quarter. Compared to last year’s Q3, the GDP improved 3.3%, meaning that it recovered 3% in only seven quarters. At this rate, it is most likely that this year’s anticipated growth rate of 2.8% will be successfully achieved.
According to the “2013 Q3 Actual GDP (Breaking News)” reported by the Bank of Korea on October 25, the actual GDP for Q3 increased 1.1% compared to the previous quarter, maintaining the same rate as Q2. In other words, the record of 0% growth which continued for eight quarters until Q1 has been broken since Q2, and maintained at 1% into Q3.
The actual GDP for Q3 increased 3.3% compared to last year’s Q3. This is the largest increase for seven quarters. The actual GDI for Q3 dropped to 0.4% from 2.7% in Q2.
The large increase in Q3 growth rate is most likely due to the increase in public consumption, investments in equipment, and investments in construction. To be specific, public consumption increased 1.1% compared to the previous quarter, making up for the -0.9% suffered in exports caused by the Korean Thanksgiving holidays.
Investments in equipment increased 1.2% from last quarter’s 0.2% decrease, and investments in construction increased 2.7%, mostly around engineering. Governmental consumption, which anticipated base effects from the autumn plowing, kept its place by increasing 0.1%.
Exports decreased 0.9%, mainly around general machinery and petrochemical products. Imports grew 0.1% with the increase of fee payments, such as intellectual property rights.