South Korean economy sees rapid turnaround
The Bank of Korea has announced that the South Korean economy expanded by 2.9% in the third quarter of 2009 – the fastest quarterly rate in more than seven years.
Today’s figures have ended a run of three consecutive quarters of negative year-on-year growth.
The news will fuel hopes that Asia’s fourth largest economy is seeing signs of a sustainable recovery as the third quarter performance exceeded expectations.
Following the announcement, the benchmark Kospi stock market index in Seoul closed up 1% at 1,657.1.
So far this year, the index has gained 47% this year after plummeting by 41% in 2008.
In a statement, the central bank said: “Industrial output, led by chips and automobiles, posted robust growth in the third quarter…. private consumption and facility investment also improved.”
The news comes just a week after it was revealed that China’s economy grew 8.9% in the third quarter from a year earlier.
The strong result was due to all sectors performing strongly and was the fastest GDP growth since quarter three last year with many analysts describing China’s recovery as “impressive”.
China is currently the world’s third largest economy but many analysts believe that it will overtake Japan to become the world’s second largest economy in the next two years.