By Kim Sung-jin
Staff Reporter


South Korea’s industrial output grew at a double-digit rate for the second consecutive month in December, indicating that the economy is on a solid recovery track.




The National Statistical Office (NSO) said on Friday that the country’s industrial output grew 11.3 percent year-on-year last month, compared with a 12.2-percent gain in November.
However, the seasonally adjusted industrial output fell 2.6 percent from a month earlier last month.

The overall domestic industrial output increased 6.4 percent for the full year in 2005.

``Production is expanding and consumers are spending more and this shows that the economic recovery is gathering momentum,’’ said Kim Kwang-sup, director in charge of NSO’s industrial trend department.

``Year-on-year corporate facility investment made a great leap in December but we have to take into account a low base a year earlier when that plant investment dipped considerably,’’ Kim said.

Corporate facility investment climbed 13.1 percent in December from the same month a year earlier, the strongest gain since the 16 percent growth recorded in January 2005. Since last February, facility investment growth in Korea remained feeble single-digit growth.

Sales of consumer goods grew 9.4 percent year-on-year and 5 percent month-on-month in December. The year-on-year growth is the highest level in 38 months since October 2002 when it was 11 percent.

The NSO said stronger demand for vehicles led the growth in consumption goods sales.

Investment in plants and equipment grew 13.1 percent from a year earlier in December, the strongest pace in 11 months.

But sluggish building orders are expected to negatively affect overall corporate capital spending in coming months. New construction orders fell 16.9 percent in December, affected by the government’s steps to curb further rises in land and apartment prices.

The semiconductor industry led the overall output growth last month with domestic microchip production growing by 47.9 percent in December from a year ago.

Production of audiovisual equipment and automobiles also remained robust in December, growing by 12.5 percent and 8.5 percent, respectively.

The termination of the special excise tax cut incentive for automobiles, coupled with a series of new models launched by domestic carmakers in the last two months of 2005, boosted domestic automobile sales, the NSO said.

sjkim@koreatimes.co.kr