Korea posts fastest Q1 growth globally on surge in chip exports

Korea's economy grew at the fastest pace in the world in the first quarter of 2026, rebounding sharply from nearing the bottom just a quarter earlier on the back of a semiconductor-led export surge.

Real GDP expanded 1.694 percent on quarter during the January-March period, the highest rate among 22 countries that have released preliminary growth figures, the Bank of Korea's (BOK) Economic Statistics System showed Tuesday.

Indonesia, which also experienced a relatively high growth rate, came in second at 1.367 percent, followed by China at 1.3 percent, with the three Asian nations the only ones to record first quarter growth above 1 percent.

Among the rest, Finland grew by 0.861 percent, Hungary by 0.805 percent, Spain by 0.614 percent, the United States by 0.494 percent, Canada by 0.4 percent and Germany by 0.334 percent. France was essentially flat at negative 0.005 percent, while Sweden contracted 0.21 percent, Mexico 0.8 percent and Ireland 2.014 percent.

Korea saw a dramatic rebound in just a quarter, rising from 38th out of 41 countries in the fourth quarter of last year, when the economy contracted 0.161 percent. If current trends hold, the country would post the world's top quarterly growth rate for the first time since the first quarter of 2010, a gap of roughly 16 years.

The surge was driven by a recovery in semiconductor-led exports. Exports jumped 5.1 percent in the first quarter, propelled by the information technology sector, with net exports contributing 1.1 percentage points to overall growth.

In fact, Samsung Electronics and SK hynix both posted quarterly results that significantly beat market expectations. Samsung reported an operating profit of 57.2 trillion won ($38 billion) and SK hynix 37.6 trillion won during the first quarter of the year.

The stronger-than-expected figures have led institutions at home and abroad to revise their forecasts upward. The Korea Institute of Finance raised its full-year growth projection for Korea from 2.1 percent to 2.8 percent. The BOK is also expected to lift its forecast when it releases an updated economic outlook on May 28.

Whether the momentum will carry into the second quarter remains uncertain. The high first quarter growth rate creates a base effect that could weigh on subsequent results, while worsening military conditions in Iran and the Middle East add external risk.

"In the second quarter, a correction in growth may be inevitable as the base effect from the first quarter surge and the impact of the Middle East war are fully felt," the government projected last month.

Korea also posted stronger-than-expected growth in the first quarter of 2024, only to contract in the very next quarter.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.

BY JEONG JAE-HONG [[email protected]]