South Korea’s GDP growth beats forecasts amid AI boom

Asia’s fourth-largest system grows 3.4 percent year-on-year amid beardown semiconductor demand.

South Korea’s system grew overmuch faster than expected successful the July-September 4th amid booming request for chips utilized successful artificial quality (AI).

Gross home merchandise (GDP) expanded 1 percent connected a quarterly basis, oregon 3.4 percent year-on-year, beforehand estimates released by the Bank of Korea showed connected Tuesday.

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The Bank of Korea forecast successful August that GDP would turn 0.3 percent successful the 3rd quarter.

Exports, which relationship for astir 45 percent of South Korea’s GDP, roseate 2.3 percent quarter-on-quarter, driven by semiconductors, machinery and electrical equipment, according to the cardinal bank.

Investment successful facilities and intelligence spot roseate 4.1 percent and 2.3 percent, respectively, portion concern successful operation edged up 0.7 percent.

Despite the robust maturation successful exports and investment, backstage depletion fell 0.2 percent.

The latest results enactment the South Korean system good connected way to execute its biggest economical enlargement successful much than a decade.

South Korean Finance Minister Lee Hyoung-il said earlier this period that helium expected maturation to scope 3.4-3.6 percent successful 2026, which would beryllium the strongest show since 2011, excluding the COVID-19 pandemic.

South Korea’s system grew 1 percent successful 2025, its slowest enlargement since the pandemic.

Asia’s fourth-largest system has capitalised connected the AI roar amid a planetary shortage of representation chips.

South Korea is location to 2 of the 3 largest representation spot makers, SK Hynix and Samsung Electronics, which unneurotic power astir 80 percent of the planetary marketplace for high-bandwidth representation and 60 percent of the marketplace for dynamic random-access memory.

South Korea’s exports successful September surged 83.5 percent year-on-year to $120.9bn, with chips accounting for astir fractional of each shipments, according to the Korea Customs Service.