By Lee Hyo-sik
Korea's per capita income will likely exceed $30,000 for the first time in 2018 if the economy expands at its present pace and the won remains relatively strong against the dollar, the government said Sunday.
If realized, this would be a significant milestone for Asia's fourth-largest economy, 12 years after its per capita gross domestic product (GDP) surpassed $20,000 in 2006.
Per capita gross national income (GNI), which is normally used to gauge the average income of each individual, is virtually interchangeable with per capita GDP. In 2016, Korea's per capita GDP was $27,533 and its per capita GNI $27,560.
According to data released by the Ministry of Strategy and Finance and the Bank of Korea, per capita GDP only increased about $400 in 2016 from the previous year, because the won lost 2.6 percent against the dollar.
Economic growth and inflation are not the only factors that determine per capita income. Population growth and foreign exchange rates also have an influence.
According to the central bank, the nation's per capita income will reach $29,200 this year _ up sharply from last year's $27,533 _ if GDP expands 4.6 percent from what it was in 2016 and the won-dollar rate averages 1,142 won.
The figure is estimated to rise to $30,400 in 2018 if the economy grows 4.5 percent. It will jump to $31,600 in 2019, $32,900 in 2020, $34,300 in 2021 and $35,800 in 2022.
"If government policies designed to bolster household income are put into place, this will certainly increase the amount of money that individuals earn," a finance ministry official said.
"We estimate the Korean economy will continue to expand at a sustainable pace on rising exports and rebounding domestic consumption. Even though the won could lose some ground against the dollar in the second half of this year, we don't expect the loss would be too steep to alter our predictions," the official said. "Without unforeseen variables, we estimate per capita income will exceed $30,000 in 2018."
According to the central bank, among advanced economies, it took an average of 8.2 years for per capita income to exceed $30,000 after surpassing $20,000.
For instance, Switzerland accomplished this feat in just two years, while it took five years for Germany and Japan. But it took more than 12 years for France and Canada to increase their per capita GDP to over $30,000.
In 2016, Luxembourg had the world's highest per capita GDP with $105,829. Switzerland and Norway were second and third with $79,578 and $71,497, respectively.
Korea's per capita income will likely exceed $30,000 for the first time in 2018 if the economy expands at its present pace and the won remains relatively strong against the dollar, the government said Sunday.
If realized, this would be a significant milestone for Asia's fourth-largest economy, 12 years after its per capita gross domestic product (GDP) surpassed $20,000 in 2006.
Per capita gross national income (GNI), which is normally used to gauge the average income of each individual, is virtually interchangeable with per capita GDP. In 2016, Korea's per capita GDP was $27,533 and its per capita GNI $27,560.
According to data released by the Ministry of Strategy and Finance and the Bank of Korea, per capita GDP only increased about $400 in 2016 from the previous year, because the won lost 2.6 percent against the dollar.
Economic growth and inflation are not the only factors that determine per capita income. Population growth and foreign exchange rates also have an influence.
According to the central bank, the nation's per capita income will reach $29,200 this year _ up sharply from last year's $27,533 _ if GDP expands 4.6 percent from what it was in 2016 and the won-dollar rate averages 1,142 won.
The figure is estimated to rise to $30,400 in 2018 if the economy grows 4.5 percent. It will jump to $31,600 in 2019, $32,900 in 2020, $34,300 in 2021 and $35,800 in 2022.
"If government policies designed to bolster household income are put into place, this will certainly increase the amount of money that individuals earn," a finance ministry official said.
"We estimate the Korean economy will continue to expand at a sustainable pace on rising exports and rebounding domestic consumption. Even though the won could lose some ground against the dollar in the second half of this year, we don't expect the loss would be too steep to alter our predictions," the official said. "Without unforeseen variables, we estimate per capita income will exceed $30,000 in 2018."
According to the central bank, among advanced economies, it took an average of 8.2 years for per capita income to exceed $30,000 after surpassing $20,000.
For instance, Switzerland accomplished this feat in just two years, while it took five years for Germany and Japan. But it took more than 12 years for France and Canada to increase their per capita GDP to over $30,000.
In 2016, Luxembourg had the world's highest per capita GDP with $105,829. Switzerland and Norway were second and third with $79,578 and $71,497, respectively.
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