South Korea's Economic Growth Driven by Technology, Says Economist

On February 2, economist Kelvin Lam from Pantheon Macroeconomics highlighted that South Korea's PMI data indicates its growth narrative is primarily driven by technology. According to Jin10, production expansion and accelerated new order growth are mainly fueled by external demand. The semiconductor sector is bolstering South Korea's economy, thanks to the investment surge in artificial intelligence and the demand for data centers. Lam noted that the upward cycle in the chip industry is unlikely to change direction in the short term. However, he pointed out that non-chip sectors remain weak, with the petrochemical and steel industries facing intense global competition and oversupply. Lam also mentioned that the weakening of the Korean won has increased import costs for manufacturers, who have only partially passed these costs onto downstream customers.