S. Korean economy continues to post 'solid' growth amid AI investment: KDI

Seoul, Nov. 9 (Yonhap) -- The South Korean economy is showing a robust pace of growth, bolstered by significant global investment in artificial intelligence (AI) infrastructure, according to a recent analysis by the Korea Development Institute (KDI). The semiconductor sector, in particular, is experiencing robust growth, driven by strong external demand.

This trend is reflected in the country's October outbound shipments, which surged by 93.7% to reach a record $115.3 billion, primarily driven by high global demand for semiconductors and continuous investment in AI-related infrastructure by major tech firms.

Exports of goods closely tied to AI data center construction, such as steel products, nonferrous metals, and electronic devices, also surged in October, according to the KDI. Concurrently, equipment investment in machinery has seen solid growth. However, the KDI warns that economic growth is not uniformly benefiting households, with private consumption growth modest in the third quarter.

High oil prices and rising market interest rates have limited household spending capacity, contributing to the uneven distribution of economic gains. Furthermore, the KDI cautions against the potential impact of ongoing conflicts in the Middle East and policy uncertainties in major economies on South Korea's economic stability.