Korean economy to improve in 2026 on chip boom: rating agency
Samsung Electronics Chairman Lee Jae-yong, front right, inspects the clean room facilities at the company's advanced semiconductor R&D complex in Yongin, Gyeonggi Province, Dec. 22, 2025. Courtesy of Samsung Electronics
Korea's economy is expected to improve this year, driven by a boom in the chip sector, yet persistent discrepancies across industries will remain a concern, a local credit rating agency said Wednesday.
"The country's economic growth is set to recover to 1.8 percent this year," Korea Investors Service Inc. (KIS) said in a web seminar on the agency's outlook for Asia's fourth-largest economy.
"Business conditions will vary between industries, while the economy's heavy reliance on a few favorable sectors, particularly semiconductors, will continue," the agency added.
KIS predicted Korea's export growth to slow in 2026, as the impact of U.S. import tariffs begin to take full effect.
But a continued semiconductor boom, the government's monetary easing policy and a recovery in local demand will remain positive factors to the local economy, it added.
The semiconductor sector, along with the defense and shipbuilding industries, will likely enjoy positive prospects this year, according to KIS.
The petrochemical, construction and retail sectors, as well as the steel, duty-free retail and secondary battery sectors, on the other hand, may face headwinds.
On the won-dollar exchange rate, the rating agency expected the local currency to remain weak against the U.S. dollar throughout the year.