South Korea’s economic recovery is being sustained by the semiconductor sector, which is compensating for a slowdown in the wider manufacturing industry, according to the Korea Development Institute (KDI).
The state-run think tank’s assessment highlights the growing divergence between the country’s high-tech export engine and its traditional industrial base.
The KDI report underscores that gains from the booming chip industry are currently the dominant factor in the nation’s economic trajectory.
This structural shift reinforces the view that South Korea’s macroeconomic health is increasingly tethered to global demand for semiconductors, particularly in data center and AI applications, rather than broad-based industrial output.
This analysis arrives as South Korean equities have staged a significant rebound.
The benchmark KOSPI index surged nearly 6 percent recently, driven by bargain hunters returning to the market and a wave of buying in technology shares.