The Bank of Korea announced the preliminary national income figures for the third quarter, revealing that the GDP remains unchanged from the initial shock estimate. The growth rate for our country in the third quarter has been tentatively confirmed at 0.1%, which is the same as the earlier estimate and is considered shockingly low. Compared to the initial figures, exports, imports, and intellectual property investment have been revised upwards, while construction and facility investments have been revised downwards. The real income earned by our citizens increased by 1.4% compared to the previous quarter, largely due to improved trade conditions and reduced real trade losses.
On December 5, the Bank of Korea announced that the real GDP growth rate for the third quarter (compared to the previous quarter, provisional) was calculated at 0.1%. Previously, the quarterly growth rate had maintained a positive (+) trend for five consecutive quarters from the first quarter of 2023 to the first quarter of this year, but it fell to -0.2% in the second quarter due to factors such as the base effect of a 1.3% growth rate in the first quarter.
Looking at the third-quarter growth rate by sector, exports decreased by 0.2%, mainly in automobiles and chemical products. Construction investment also declined by 3.6%, focusing on building construction. Conversely, imports increased by 1.6%, primarily in machinery and equipment, and private consumption grew by 0.5%, with increases in both goods like electricity, gas, and passenger cars and services like medical and transportation.
Facility investment rose by 6.5%, mainly in machinery such as semiconductor manufacturing equipment and transportation equipment like aircraft. Government consumption also increased by 0.6%, influenced by in-kind social security benefits such as health insurance payments.
Compared to the initial figures, the growth rates for construction investment (-0.8 percentage points) and facility investment (-0.4 percentage points) were lower, but exports (+0.2 percentage points), imports (+0.1 percentage points), and intellectual property investment (+0.1 percentage points) were revised upwards.
The contribution to the third-quarter growth rate came from net exports (exports-imports), which were at -0.8 percentage points, meaning it reduced the growth rate by almost 1 percentage point. However, the previously concerning domestic demand raised the growth rate by 0.8 percentage points.
The nominal Gross National Income (GNI) for the third quarter fell by 0.5% compared to the previous quarter. However, nominal net factor income from abroad increased from 7.3 trillion won to 9 trillion won, exceeding the nominal GDP growth rate (-0.8%).
Real GNI increased by 1.4%. Thanks to improved trade conditions, real trade losses decreased from 16.6 trillion won to 14.2 trillion won, resulting in a real GNI growth rate higher than the real GDP growth rate (0.1%).
The total savings rate declined by 0.8 percentage points to 34.4% compared to the previous quarter, due to a decrease in Gross National Disposable Income (-0.4%) and an increase in Final Consumption Expenditure (0.8%).
The domestic investment rate fell by 0.8 percentage points to 29.9% compared to the previous quarter, as the growth rate of Gross Capital Formation (-2.9%) was lower than that of Gross National Disposable Income (-0.4%). On the other hand, the foreign investment rate increased by 0.1 percentage points to 4.6% compared to the previous quarter.