Korea Q3 GDP Up 1.0%; Net Exports 0.1pp Amid Chip Boom

Exports added 1.1 percentage points (pp) to South Korea's growth in the third quarter, and imports took 1.0pp of that back. The figures come from the contribution table in the advance estimate of real GDP for Q3 2026 that the Bank of Korea, the country's central bank and the compiler of its GDP statistics, released on October 27. Real GDP grew 1.0% from the previous quarter (not annualized), with net exports accounting for 0.1pp. On October 21, the Korea Customs Service said exports for October 1–20 were up 105.4% from a year earlier. In the same release, semiconductor exports rose 222.5% and total imports climbed 42.8%. The Q3 contribution table shows the same pattern of exports and imports rising together.

This article is current as of 3:50 p.m. KST on October 29, 2026, and all figures are the Bank of Korea's October 27 advance estimates. The central bank says the advance estimate can't fully use data for the quarter's final month, so it may differ from the preliminary estimate it will publish later.

1.1pp from exports, minus 1.0pp for imports

In the advance release, real exports rose 2.3% from the previous quarter, led by semiconductors, machinery and electrical equipment. Real imports grew 2.4%, driven by crude oil and chipmaking equipment, among other items. GDP accounting subtracts imports. Take the 1.0pp import contribution away from the 1.1pp export contribution, and net exports are left with 0.1pp.

The net export share has shrunk every quarter this year: 1.1pp in Q1 (exports 2.7pp, imports 1.6pp), then 0.3pp in Q2. In Q3, the export contribution nearly doubled from Q2, while the import contribution rose from 0.3pp to 1.0pp.

Setting the two numbers from the opening paragraph side by side calls for a caveat. The 105.4% figure compares dollar-value exports for October 1–20 with the same period a year earlier. Contributions compare real GDP for July–September with the previous quarter. The periods differ, and so do the baselines. We covered other caveats for reading the October 1–20 export data in PRISM 5 Things, Issue 4.

Table 1. Contributions to growth (seasonally adjusted, quarter on quarter, pp)

Source: Table 1 of the Bank of Korea's advance release. Inventories (0.1pp in Q3) and the statistical discrepancy (-0.1pp) are left out. The sector split (private + government) and the expenditure split (domestic demand + net exports) are two ways of dividing the same GDP. Components may not add up to totals because of rounding.

Shifts in equipment investment, manufacturing and income

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Other lines in the table moved more. Facilities investment, the Bank of Korea's term for spending on equipment, rose 4.1%, led by machinery such as chipmaking equipment. Its contribution climbed from 0.0pp in Q2 to 0.4pp in Q3. By industry, manufacturing grew 2.0%, with gains in computers, electronic and optical products, and in machinery and equipment. Manufacturing contributed 0.6pp, up from 0.4pp in Q2. Chipmaking equipment and electronic and optical products overlap with semiconductors, but the Bank of Korea doesn't publish a separate contribution for chips alone.

The income measure moved further still. Real gross domestic income (GDI) rose 3.4% from the previous quarter and 18.8% from a year earlier. The Bank of Korea wrote that GDI growth outpaced GDP growth (1.0%) by a wide margin. Korean outlets including Financial News and Digital Times reported on October 27 that the gap reflected "the effect of improved terms of trade for semiconductor exports, among other factors."

Private 0.2pp, government 0.8pp

Split by sector, the weight of growth shifted toward the government. The private sector's contribution fell from 1.1pp in Q2 to 0.2pp in Q3. The government's swung from -0.5pp to 0.8pp. Government consumption rose 1.9% as spending on goods and on health insurance benefits increased.

Private consumption fell 0.2%. Spending dropped on goods, such as cars and home appliances, and on services, such as financial and food services. Its contribution was -0.1pp. Digital Times reported that it was the first decline in private consumption since the first quarter of 2022.

The same numbers lead to different emphases. The optimistic read looks at the gap with forecasts. Q3's 1.0% beat the 0.3% the Bank of Korea projected in its August economic outlook, according to Financial News and The Korea Times. In its October 22 assessment of economic conditions, the central bank said "the domestic economy is expected to show strong growth, considerably above the previous forecast path," as quoted by iNews24.

The cautious read looks at consumption. "To see the economy clearly, you especially need to check consumption," Yang Jun-seok, an economics professor at the Catholic University of Korea, told Money Today on October 25. Q3's split of 0.2pp private versus 0.8pp government points in the same direction as that concern, which he raised before the release.

How Korea compares with China and Taiwan

China's third-quarter GDP grew 4.5% from a year earlier and 1.2% from the previous quarter, the National Bureau of Statistics of China said on October 19. On the same two measures, Korea grew 3.4% and 1.0%. Compared like for like, China is higher on both.

Taiwan hasn't released Q3 figures yet. In an August 14 release, Taiwan's Directorate-General of Budget, Accounting and Statistics (DGBAS) put second-quarter growth at 12.93% year on year. The same release forecast 11.42% year-on-year growth for Q3. Korea's 3.4% is an actual result; Taiwan's 11.42% is a forecast. DGBAS reports its quarter-on-quarter series as a seasonally adjusted annualized rate (SAAR), so it can't be compared directly with Korea's quarter-on-quarter figure.

The mood in Taiwan leans hopeful. On October 25, the Economic Daily News reported that demand for AI and high-performance computing (HPC) was keeping exports on a run of record highs. The paper also cited expectations of Q3 growth in the 13% range.

What to watch

• Friday, October 30 Taiwan's advance estimate for Q3. The date comes from an October 25 Economic Daily News report, and we couldn't confirm the release time. It's the actual figure to set against the DGBAS forecast of 11.42%.
• Korea's preliminary Q3 estimate The Bank of Korea will publish it later. Once full September data are in, watch whether private consumption's -0.2% and net exports' 0.1pp hold.
• Sunday, November 1 Korea's trade ministry is expected to release October export and import data. The date follows the ministry's practice of publishing on the 1st of each month, and we couldn't confirm an official schedule. The release will show how the 105.4% gain for October 1–20 holds up over the full month.