Seoul: South Korea’s economic growth in the fourth quarter last year slowed down after peaking to a five-year high as the construction sector faltered on slump in home transactions and lower government spending on infrastructure, official data showed on Tuesday.
Real gross domestic product (GDP) rose 0.6 percent during the October-December period from the previous three months, according to the Bank of Korea. It halved from a 1.3 percent growth in the third quarter, which was the highest figure since the second quarter of 2010, reported Xinhua.
Private consumption expanded at a faster pace in the fourth quarter than the previous quarter, while exports rose after falling in the third quarter, contributing to growth of the export-driven economy.
Construction investment, however, plunged 6.1 percent for the three-month period to December 31 after increasing 5.0 percent in the third quarter. Investment in the construction industry advanced 7.4 percent in the first quarter and 1.6 percent in the second quarter each.
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“Construction investment, which had shown positive pictures for the first three quarters of last year, fell sharply in the fourth quarter due to slowing housing market and shrinkage in social overhead spending,” Jeon Seung-Cheol, director general of the bank’s economic statistics department, told a press conference.
According to the land and transport ministry’s data, South Korea’s housing transactions amounted to 1.19 million in 2015, up 19 percent from a year earlier. It was up from 18 percent in 2014 and 16 percent in 2013 each.
In December alone, the home transactions declined 10 percent compared with the previous month, indicating the housing market turning downward toward the end of 2015.