South Korea’s economy grew at a faster-than-expected pace in the fourth quarter as it ended the coronavirus-stricken year solidly poised for a recovery in 2021 thanks to surging exports.

Gross domestic product (GDP) grew a seasonally adjusted 1.1 per cent in the December quarter from the September quarter, the Bank of Korea said on Tuesday, faster than the median estimate of 0.7 per cent in a Reuters poll and following a 2.1 per cent expansion in the September quarter.

That limited the contraction over the whole year to 1.0 per cent,which is likely to be the smallest GDP slump among the Organisation for Economic Co-operation and Development in the year of the pandemic that killed more than two million worldwide.

South Korea’s economy has been rebounding sharply since the second quarter when it experienced its sharpest downturn since 2008. But the recovery from the virus-hit downturn has been uneven.

December exports surged 12.6 per cent from a year earlier, the sharpest expansion in 26 months.

But the number of jobs plunged at the sharpest rate in over two decades in December, a sign the recovery is still fragile amid the third wave of the coronavirus now sweeping the country.

Data on Tuesday showed exports jumped 5.2 per cent in the fourth quarter from three months earlier, which helped offset a 1.7 per cent decline in private consumption because of toughened Covid-19 social-distancing measures since late last year.

Construction investment jumped 6.5 per cent from a quarter earlier, logging the best performance since the fourth quarter of 2019.

On a year-on-year basis, the economy shrank 1.4 per cent in the fourth quarter, less than the 1.7 per cent decline forecast in the poll.

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