Korea’s economic recovery yet to benefit households broadly: KDI

The benefits of Korea’s economic recovery have yet to reach households more broadly, a state-run think tank said Monday, noting the recovery in their purchasing power remains limited.

“The recovery in household purchasing power remains constrained due to subdued underlying wage growth and elevated supply-side inflationary pressures, including those from persistently high oil prices,” the Korea Development Institute (KDI) said in its monthly economic assessment.

The KDI noted that despite the Korean economy’s recovery led by the artificial intelligence (AI) industry, its benefits have not yet reached households broadly.

The think tank nevertheless said the Korean economy appears to be maintaining its recovery momentum, with manufacturing output continuing to grow at a solid pace.

“Exports and equipment investment continue to grow strongly, led by AI-related sectors, as global demand for AI infrastructure investment remains robust,” the KDI said.

In September, Korea’s exports soared 83.5 percent from a year earlier to a record $120.9 billion, driven by a surge in chip shipments.

Semiconductor exports exceeded $60 billion for the first time ever last month, boosting overall export figures.

“Semiconductor and computer exports continue to grow rapidly, while exports of other products linked to AI infrastructure, including steel products and nonferrous metals, also remain solid,” it added.