Xinhua, Seoul :
The South Korean economy grew 2.8 percent in 2013, the first rebound in three years, on the back of solid growth of exports and private consumption, central bank data showed Thursday.
Real gross domestic product (GDP), the broadest measure of economic performance, expanded at an annual rate of 2.8 percent, according to the Bank of Korea (BOK). The central bank set its 2014 growth outlook at 3.8 percent.
The country’s economic growth fell to 2 percent in 2012 after peaking at 6.3 percent in 2010, but it rebounded last year to 2.8 percent for the first time in three years.
The rebound was bolstered by solid export growth and continued expansion in private spending, the central bank said, noting that a sharp rise in construction investment also boosted the economic growth.
Private spending increased 1.9 percent last year after rising 1. 7 percent in the previous year, and exports of goods and services jumped 4.3 percent in 2013 after expanding 4.2 percent in the prior year.
Facility investment reduced 1.5 percent in 2013, but it was down from a 1.9 percent decline in 2012. Construction investment surged 6.9 percent last year after falling 2.2 percent in the prior year.
The real GDP rose 0.9 percent in the fourth quarter from three months earlier after expanding 1.1 percent in the prior quarter, according to the BOK.
“The moderation is not worrisome as it mostly reflects a pullback from fast growth in the first three quarters of 2013, and domestic and external fundamentals are positive in early 2014,” Matthew Circosta, an economist at Moody’s Analytics in Sydney, said in a report.
The private spending continued to grow in the quarter, bolstering the economy, but the government expenditure slowed sharply amid a fall in tax revenue.
Facility investment growth accelerated to 6.5 percent in the fourth quarter from 1 percent in the prior quarter, but construction investment reduced 3.8 percent in the quarter after rising 3.2 percent in the prior quarter.
Exports, which account for around half of the economy, gained 2 percent in the quarter after reducing 1.3 percent in the previous quarter. The rebound was attributed to robust demand for locally- made cars, components, general machinery and petrochemicals.
However, negative factors remained to the South Korean economy. The U.S. Federal Reserve decided to reduce its monthly bond purchases by 10 billion U.S. dollars to 75 billion dollars starting from this month.
The Fed tapering was feared to lead foreign capital to flow out of emerging economies, including South Korea, amid lack of liquidity.
Concerns over the weak yen trend remained. The weak Japanese yen fueled worries about price competitiveness and overseas earnings of South Korean exporters, which are competing with Japanese rivals in many sectors.
