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Korea is back to being 11th biggest GDP

Published: 16 Aug. 2016, 20:45

Korea was the world’s 11th-largest economy as of 2015, recovering a rank it lost nine years ago.

According to the World Bank, Korea’s nominal GDP was $1.378 trillion last year. Even though the figure dropped 2.4 percent year-on-year from $1.42 trillion in 2014, Korea rose two notches in the World Bank’s ranking for 2015.

Korea was in 12th place in 2001 and clinched the 11th spot in 2002 and 2004. It climbed as high as 10th in 2005, but fell back to 11th the following year. Korea dropped to as low as 15th in 2008 but recovered since then.

“It certainly is a positive thing that Korea has moved up two notches in the GDP ranking,” said Park Sang-hyun, a chief economist at Hi Investment & Securities. “But there are various factors that might affect the ranking in general and it is very hard to say for sure whether that Korean economy has improved significantly from the previous year.”

According to Park, the value of every country’s currencies and their economic situations - such as the price of commodities - has an impact on the World Bank’s ranking.

“The value of a currency matters because the data is measured in U.S. dollars,” Park said. “The Korean won weakened last year against the dollar, but its drop wasn’t as big as other currencies such as the Russian rouble. It is simply very hard to interpret the ranking as a sign of improvement.”

In fact, Russia, which was placed in 10th in 2014, fell to 13th last year. Russia’s GDP dropped 34.7 percent year-on-year to $1.33 trillion in 2015, according to the World Bank. Furthermore, Australia, which came in 12th in 2014, saw its GDP fall 7.9 percent year-on-year as well.

“Russia and Australia, which have high dependency on exports, saw their economies slow due to the fall in commodity prices last year,” said Park at Hi Investment & Securities.

The United States was the country with the highest GDP of $17.95 trillion. It was followed by China ($10.87 trillion), Japan ($4.12 trillion) and Germany ($3.36 trillion).

Meanwhile, Korea’s gross national income (GNI) per capita was $27,440 last year and was ranked 46th.

Korea’s GNI ranking fell four notches compared to the previous year.

BY KIM YOUNG-NAM [[email protected]]