South Korea's real gross domestic product (GDP) grew by 1.8% in the first quarter of 2026, exceeding initial estimates. The per capita gross national income (GNI) increased by 9.2% compared to the previous quarter.
According to the Bank of Korea's report released on June 5, the real GDP for the first quarter of this year showed a growth of 1.8% from the previous quarter.
By sector, manufacturing saw a significant increase of 3.9%, driven primarily by computers, electronics, and optical equipment. The construction sector grew by 2.2%, supported by increases in both building and civil engineering projects, while the service sector rose by 0.6%, led by retail, accommodation, and food services, as well as finance and insurance.
In terms of expenditures, private consumption rose by 0.6%, while government consumption decreased by 0.4%. Construction investment and facility investment increased by 1.4% and 6.6%, respectively. Exports, particularly in IT products like semiconductors, grew by 5.9%, while imports rose by 3.9%, driven by machinery, equipment, and automobiles.
The GDP deflator increased by 12.9% year-on-year. This measure, which reflects the overall price level including exports and imports, is calculated by dividing nominal GDP by real GDP.
The real GNI for the first quarter surged by 9.2% compared to the previous quarter. The Bank of Korea noted, "Improved terms of trade and an increase in real net income from abroad (from 8.2 trillion won to 11.6 trillion won) significantly contributed to the real GDP growth rate of 1.8%."
Per capita GNI serves as an indicator of the average standard of living in a country. It is calculated by adding nominal GNI, which includes nominal GDP adjusted for net income from abroad, and dividing it by the population estimated by the National Statistical Office. However, since it is expressed in U.S. dollars, fluctuations in exchange rates can affect the figures.
Additionally, last year's per capita GNI was recorded at $36,963, reflecting a 0.3% increase from the previous year. South Korea's per capita GNI first surpassed $30,000 in 2014 ($30,798) and peaked at $35,494 in 2018, before declining for two consecutive years in 2019 ($34,094) and 2020 ($33,929).
In 2021, the per capita GNI rebounded to $37,898 as the economy recovered from the impacts of COVID-19 and the value of the won increased. However, in 2022, it fell again to $35,229 due to a sharp depreciation of the won against the dollar.
In 2023, the per capita GNI rose to $36,194, avoiding a second consecutive decline, but still falling short of the record high of $37,898 in 2021.
Last year's GDP deflator rose by 3.2% compared to the previous year. The annual real GDP growth rate for last year was recorded at 1.1%, despite a widening decline in construction investment and a slowdown in export growth, as increases in private and government consumption and facility investment contributed positively.
* This article has been translated by AI.
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