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SEOUL, Jan. 26 (Yonhap) -- South Korea's economy grew at a slower pace in 2022 on weak exports and corporate investment amid mounting economic recession woes, central bank data showed Thursday.
South Korea's gross domestic product is estimated to have grown 2.6 percent in 2022, compared with a 4.1 percent increase tallied in the previous year, according to the data from the Bank of Korea (BOK). It still beat the BOK's annual growth outlook.
For the fourth quarter of last year, the economy shrank 0.4 percent from three months earlier, compared with the previous quarter's 0.3 percent growth.
The 2022 growth marked the slowest pace since 2020, when the economy contracted 0.7 percent amid the fallout from the coronavirus pandemic.
The slower growth is blamed on weak exports growth amid slumping sales of semiconductors and other goods. Overseas shipments expanded 2.9 percent in 2022, compared with a 10.8 percent rise in 2021, the data showed.
South Korea's economy faces mounting worries over a recession that could hurt demand for South Korean goods weighed down by global monetary tightening aimed at reducing high inflation.
The prospect for the economy remains bleak going forward as exports are expected to remain sluggish and consumption and corporate investment are feared to slump amid high borrowing costs driven by the BOK's rate hikes.
Strict coronavirus curbs in China, in particular, hit South Korea's exports hard last year as their access to the world's largest market was hampered.
Private consumption expanded 4.4 percent last year, higher than a 3.7 percent rise in 2021, apparently thanks to eased coronavirus curbs.
Facility investment, however, shrank 0.7 percent last year compared with a 9 percent advance tallied a year earlier. Investment in construction contracted 3.5 percent, worse than a 1.6 percent decline a year earlier.
Government spending increased 4.2 percent last year, lower than the previous year's 5.6 percent advance.
Worries are growing that economic growth could further decelerate going forward as exports are likely to stay sluggish amid mounting worries over a recession.
In November, the BOK expected the economy to grow 1.7 percent this year, but BOK Gov. Rhee Chang-yong recently voiced worries that the growth could be slower than the projection, citing the possibility of a global recession and the impact of steep rate hikes on the overall economy.
Hang Sang-pil, head of the BOK's economic statistics bureau, told reporters Thursday that private consumption appears to be growing, but it is still hard to predict the path of economic growth.
"Despite sluggish exports, private consumption appears to be increasing compared with the previous quarter as credit card use is expanding," he said. "Still, it is hard to predict whether the first-quarter growth rate will be positive or negative at this point."