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S. Korea's GDP growth falls below U.S., Japan in Q2: OECD

All Headlines 12:09 September 30, 2018

SEOUL, Sept. 30 (Yonhap) -- South Korea's economy grew at a slower pace than that of the United States and Japan in the second quarter of this year, a report by the Organization for Economic Cooperation and Development (OECD) showed Sunday.

The data by the Paris-based organization said the country's seasonally adjusted gross domestic product (GDP) advanced 0.6 percent compared to the first quarter in the April-June period. This is slower than the 1 percent tallied for the United States and 0.7 percent for Japan.

The numbers comes as the growth rate of Asia's fourth-largest economy outpaced that of Washington and Tokyo in the first quarter of 2018. In January-March, South Korea's GDP moved up 1 percent compared to a 0.5 percent gain for the U.S. and minus 0.2 percent posted by Japan.

S. Korea's GDP growth falls below U.S., Japan in Q2: OECD - 1

The OECD said that Seoul's number in the second quarter also trailed that of the G20 systemically important industrialized and developing economies, which pulled off 1 percent growth. It added that the average growth for OECD nations edged passed that of South Korea at 0.7 percent in the three-month period.

It attributed the drop to the weakening of investment and sluggishness in the country's key industries in recent months.

The Bank of Korea (BOK) said earlier that manufacturing sector growth stood at just 0.6 percent, down 1 percentage point from the first three months of this year, while construction actually contracted 3.1 percent on-quarter. In the first three months, the construction industry expanded 2.1 percent.

Reflecting the poorer showing, the OECD said in its Interim Economic Outlook report that South Korea may be able to grow 2.7 percent this year and 2.8 percent in 2019. This is down 0.3 percentage point from its estimate for 2018 released in May, and 0.2 percentage point from the forecast for next year.

The downgrade is in line with moves by other international organizations such as the Asian Development Bank, which adjusted down South Korea's GDP growth estimate to 2.9 percent from 3 percent and next year's numbers to 2.8 percent from 2.9 percent.

The BOK too said in July that Seoul will likely grow 2.9 percent this year, down from the 3 percent which it said was possible earlier.

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