South Korea records lowest Q1 economic growth among major economies

Seoul, May 11
South Korea posted the lowest economic growth among 19 major economies in the first quarter, data showed on Sunday, amid a domestic political crisis and uncertainties caused by US President Donald Trump's administration's sweeping tariff policies.

The country's real gross domestic product (GDP) -- a key measure of economic growth -- shrank by 0.246 percent in the January-March period from a quarter earlier, according to the data from the Bank of Korea (BOK).

It marked the weakest performance among the 19 major nations that have released their first-quarter growth figures, including the United States, Canada, France, Germany and China, reports Yonhap news agency.

Ireland recorded the highest growth rate at 3.219 percent, followed by China with 1.2 percent and Indonesia with 1.124 percent.

Spain, which has a similar GDP to South Korea, ranked fourth with a growth rate of 0.568 percent. Canada logged a 0.4 percent expansion in the first quarter, while Italy and Germany posted growth rates of 0.4 percent and 0.26 percent, respectively. France also saw positive growth at 0.127 percent.

The U.S. economy contracted by 0.069 percent, and Hungary's economy shrank by 0.152 percent.

Japan and Britain have yet to disclose their first-quarter data, but a Bloomberg survey of major institutions showed that the Japanese economy is expected to contract by 0.1 percent, while Britain is forecast to grow by 0.6 percent.

South Korea's unexpected negative growth was partly attributed to political turmoil triggered by former President Yoon Suk Yeol's shocking imposition of martial law on Dec. 3, which disrupted the economy and dampened consumer spending. Yoon was removed from office April 4.

The U.S.' sweeping tariff scheme has also weighed on the trade-dependent South Korean economy. Trump earlier announced "reciprocal" tariffs that include a 25 percent tariff on South Korea, though he soon decided to put on hold its implementation for 90 days.

Apart from the proposed reciprocal tariffs, existing tariffs on autos and steel remain in effect.

The BOK earlier presented a 1.5 percent growth outlook for the South Korean economy in 2025, but Gov. Rhee Chang-yong later told reporters that the forecast may have been "too optimistic."

The central bank also cited several "unusual factors" that weighed on growth, including delayed demand for high-performance semiconductors, the suspension of projects at some construction sites and large-scale wildfires.

Asia's fourth-largest economy expanded 1.3 percent in the first quarter of 2024 but slipped into a contraction in the second quarter with a 0.2 percent decline, followed by marginal growth of 0.1 percent in both the third and fourth quarters.