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South Korea
South Korea’s GDP grew by 2.9 percent during the 3rd quarter of 2009 (July – Sep 2009) which is all time high for the country during the last 7 years.
Major factors for growth
• South Korea’s GDP growth during the quarter is attributed to
o Growth in domestic demand
o Growth in exports
• Exports of South Korea grew by 5.1% during the last quarter
• Private sector played a big role in the growth of the economy
• The GDP growth is considered surprise as the Bank of Korea had earlier projected the economy to contract 1.6 percent during 2009.
• Robust earnings by leading exporters like Hyundai Motor and Samsung Electronics played a big role in the recovery
• The recovery was also helped by record low interest rates and big government spending.
• Bank of Korea has projected that the recovery will be 5% during the fourth quarter of the current year
Challenges
• South Korea still faces the delay in the recovery of global Economic slowdown.
• Inventory has increased while consumption and construction investment has not grown
