South Korea's GDP grows 1.1 percent, GNI up 2.1 percent

South Korea's real GDP growth of 1.1 percent in 2025 was driven by expanding private consumption, government consumption, and facilities investment, despite a deepening decline in construction investment and moderated export growth.

By production category, manufacturing saw a 2.4 percent increase, boosted by computer, electronic, optical products, and transportation equipment.

Services also expanded by 1.7 percent, primarily due to growth in transportation & storage, finance & insurance, and human health & social work.

However, construction contracted significantly by 9.2 percent, reflecting decreases in both building and civil engineering.

From an expenditure perspective, private consumption grew by 1.5 percent, while gross fixed capital formation decreased by 3.4 percent, largely due to a 9.7 percent fall in construction investment.

Facilities investment, however, rose by 1.5 percent, and exports expanded by 4.3 percent, mainly from IT items such as semiconductors.

South Korea's nominal gross domestic product increased by 4.4 percent in 2025, reaching 2,676.7 trillion won.

Compensation of employees rose by 3.8 percent, driven by wage growth in manufacturing, while operating surplus grew by 6.3 percent, led by manufacturing and securities.

GNI per capita in U.S. dollar terms saw a modest 0.3 percent rise to $36,963. The GDP deflator, reflecting overall price changes, increased by 3.2 percent year-on-year.

Furthermore, the gross saving ratio stood at 35.1 percent, a 0.4 percentage point increase, while the gross domestic investment ratio was 28.6 percent, down by 0.9 percentage points from the previous year.