Seoul, Jan 30
South Korea's industrial output grew at the slowest pace in five years in 2025, despite strong growth in the semiconductor industry, while retail sales and facility investment showed signs of improvement, government data showed on Friday.
Industrial output gained 0.5 percent from a year earlier in 2025, slowing from a 1.5 percent increase the previous year, according to the data from the Ministry of Statistics and Data, reports Yonhap news agency.
The 2025 figure marks the weakest growth since 2020, when output contracted amid the fallout from the COVID-19 pandemic.
The output of the mining and manufacturing sector, considered the backbone of the economy, gained 1.6 percent in 2025, the ministry said.
Notably, chip output surged 13.2 percent on-year as global demand continued to rise amid the artificial intelligence (AI) boom.
"Semiconductors strongly drove growth in 2025," Lee Doo-won, a ministry official, told reporters. "We saw a virtuous cycle with expanded investment in semiconductor facilities and equipment."
Retail sales, a key indicator of private spending, also rose 0.5 percent from a year earlier, rebounding from a decline the previous year.
After three consecutive years of shrinking consumption, private spending turned positive for the first time in four years.
The growth was particularly strong in the third quarter of 2025, fueled by the government's cash handouts known as consumption coupons, the ministry said.
The rise was led by higher sales of durable goods, such as passenger vehicles, which jumped 4.5 percent on-year, the data showed.
Sales of semidurable goods, such as clothing, fell 2.2 percent, while sales of nondurable goods, including cosmetics, slipped 0.3 percent.
Facility investment advanced 1.7 percent on-year in 2025, extending gains for a second straight year, supported by strong demand for transportation equipment and chip-related machinery, according to the data.
Construction investment weakened, with construction orders falling 16.2 percent from a year earlier, the data showed.
In December alone, industrial output rose 1.5 percent from the previous month, driven by strong demand for semiconductors and automobiles.
Retail sales increased 0.9 percent on-month, rebounding from a decline in November, supported by higher sales of clothing, food and beverages.
In contrast, facility investment fell 3.6 percent, largely due to a 16.1 percent decline in transport equipment, including ships and aircraft.
- IANS
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