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S. Korea's economic growth falls to two-year low in Q4

Xinhua, January 23, 2015 Adjust font size:

South Korea's economic growth fell to the lowest in more than two years in the fourth quarter as unusual factors, such as less fiscal spending caused by the lack of tax revenue, weighed down on the economy, central bank data showed Friday.

Real gross domestic product (GDP) grew 0.4 percent in the fourth quarter of 2014 on a quarterly basis, according to the Bank of Korea (BOK). It was the lowest since the first quarter of 2009 when it recorded a 0.1-percent gain.

The low growth came as the government spent less than expected amid lack of tax revenue caused by economic slowdown. The central bank cut its 2015 growth forecast to 3.4 percent from an earlier estimate of 3.9 percent for the lackluster fourth-quarter growth.

Other factors, which "temporarily" dented the fourth-quarter expansion, included tighter regulations on subsidies for mobile devices and marriage reduction on growing expenses for livelihood and childcare. Endi