Why Are Seoul's Industrial Output and Retail Sales Declining in Q1?
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Synopsis
In Seoul's first quarter, industrial output and retail sales showed a notable decline compared to the previous year, while the service sector thrived. Discover the factors impacting these trends in our detailed analysis.
Key Takeaways
- Seoul's industrial output fell by 2.1 percent year-on-year.
- Retail sales declined by 2.1 percent in the first quarter.
- The service sector grew by 1.2 percent year-on-year.
- Nationally, industrial output increased by 2.4 percent.
- Export declines were noted in 10 major regions.
Seoul, May 13 (NationPress) The first quarter of this year saw a decline in industrial output and retail sales in Seoul compared to the same period last year, according to government statistics released on Tuesday. Despite the overall economic slowdown, the city's service sector exhibited resilience.
During the January to March timeframe, Seoul's industrial production fell by 2.1 percent year-on-year, primarily influenced by reduced activities in the electricity and gas, food manufacturing, and machinery equipment industries, as per data from Statistics Korea.
Conversely, on a national scale, industrial output increased by 2.4 percent year-on-year, buoyed by strong performance in semiconductors, electronic components, and pharmaceuticals, according to reports from Yonhap news agency.
Retail sales in Seoul also experienced a decline of 2.1 percent year-on-year during the first quarter, largely attributed to a downturn in duty-free shops and the sales of automobiles and fuel.
In contrast, nationwide retail sales remained stable compared to the previous year, reflecting varying consumer sentiments amid economic uncertainties.
Interestingly, Seoul's service output rose by 1.2 percent year-on-year, supported by consistent growth in the real estate, arts, sports, and recreation sectors, as noted by the data.
“In times of low growth, we often observe a disparity where some sectors thrive while others struggle,” stated Jeong Sung-kyeong, an official from Statistics Korea. “Nonetheless, the service sector in Seoul continues to demonstrate resilience, achieving its 19th consecutive quarterly increase.”
Meanwhile, exports saw a downturn in 10 out of the 17 major cities and provinces in the first quarter, amid escalating uncertainties regarding U.S. trade policy, which is influencing regional economies.
The number of regions experiencing falling exports rose from seven in the fourth quarter of 2024 to ten in the first quarter of this year.
Notably, outbound shipments from Busan, the nation's second-largest city, decreased by 3.1 percent year-on-year, as highlighted by the data.
Point of View
It is crucial to understand the broader implications of Seoul's economic trends. The contrast between declining industrial and retail sectors and the thriving service industry reflects a complex economic landscape that demands attention and strategic planning for sustainable growth.
NationPress
22/07/2025
Frequently Asked Questions
What caused the decline in Seoul's industrial output?
The decline in Seoul's industrial output was primarily due to reduced production in the electricity and gas, food manufacturing, and machinery equipment sectors.
How did retail sales perform in Seoul during Q1?
Retail sales in Seoul fell by 2.1 percent year-on-year during the first quarter, largely due to weaker performance in duty-free shops and sales of automobiles and fuel.
Is the service sector in Seoul doing well?
Yes, the service sector in Seoul grew by 1.2 percent year-on-year, indicating resilience despite broader economic challenges.
What are the national trends in industrial output?
Nationwide, industrial output saw a rise of 2.4 percent year-on-year, driven by strong performance in semiconductors, electronic components, and pharmaceuticals.
How did exports perform in other regions of South Korea?
Exports fell in 10 out of the country's 17 major cities and provinces during the first quarter, indicating a growing uncertainty surrounding trade policies.
