S. Korea's Q4 economic growth slowest in over 2 yrs

The South Korean economy expanded at the slowest pace in more than two years in the fourth quarter, central bank data showed Friday, raising concerns over faltering growth.

Asia's fourth-largest economy expanded 0.4 percent during the October-December period, sharply decelerating from the 0.9 percent on-quarter growth in the July-September period, according to the Bank of Korea (BOK). The figures are seasonally adjusted.

The fourth-quarter expansion marks the lowest on a quarterly basis since the 0.4 percent gain in the third quarter of 2012.

The figure is in line with an earlier estimate by BOK Gov. Lee Ju-yeol. He estimated growth to have slowed down in the fourth quarter, citing "exceptional" factors, such as "a significant fall in consumption expenditures of telecommunications products, as well as a fall in infrastructure investment due to insufficient tax revenue."

From a year earlier, Asia's fourth-largest economy expanded 2.7 percent in the three-month period, marking the slowest growth since the second quarter of 2013.

On an annual basis, the gross domestic product increased 3.3 percent on-year, picking up from a 3 percent growth posted in 2013. The figure is slightly lower than the central bank's growth forecast of 3.4 percent for this year.

By sector, private spending rose 0.5 percent on-quarter during the October-December period, slowing from a 1 percent growth three months earlier.

Government spending growth slowed to 0.5 percent, compared with a 2.3 percent increase in the third quarter. Construction investment dropped 9.2 percent on-quarter as government spending waned.

Exports, the country's key growth engine, slipped 0.3 percent on-quarter, shrinking for a second straight quarter. Imports also fell for a second consecutive quarter to 0.6 percent as oil prices continued to slide.

The data comes roughly a week after the central bank's sharp downward revision of its growth outlook spurred worries over the course of the South Korean economy.

The BOK governor said, however, the move does not reflect pessimism in its outlook for the economy.

"I do realize that some took it as a mild surprise that we had undertaken a downward revision," he said in a Jan. 22 press briefing. "Let me reiterate that this is because of the exceptional factors in the fourth quarter of last year, and we do not have a pessimistic or grim view of the Korean economic outlook for this year." (Yonhap)