South Korea Posts 1% Quarterly GDP Growth on Chip Demand

South Korea's economy expanded 1% in the July-September quarter, Bank of Korea advance estimates showed Tuesday.

The quarterly figure translated to 3.4% growth compared with the same period a year earlier. The Bank of Korea had projected 0.3% quarterly growth for the third quarter in its August forecast. Exports rose 2.3% quarter-on-quarter, led by semiconductors, machinery and electrical equipment. Exports make up about 45% of South Korea's GDP. Investment in facilities increased 4.1%, investment in intellectual property rose 2.3%, and construction investment grew 0.7%. Private consumption fell 0.2%.

Finance Minister Lee Hyoung-il said earlier this month that he expects 3.4-3.6% growth for 2026, which would be the strongest year since 2011 excluding the pandemic period. South Korea grew 1% in 2025, its slowest pace since the pandemic.

SK Hynix and Samsung Electronics, two of the world's three largest memory chip makers, hold roughly 80% of the global high-bandwidth memory market and 60% of the dynamic random-access memory market. Korea Customs Service data shows September exports reached $120.9bn, up 83.5% from a year earlier, with chips making up nearly half of shipments.

Lee Hyoung-il's 3.4-3.6% projection would mark South Korea's strongest performance since 2011, excluding the pandemic period.