Second-quarter nominal GNI up 26.4%... Per capita national income to exceed $40,000

South Korea's per capita gross national income (GNI) is projected to surpass $40,000 for the first time in history this year. This comes amid a surge in nominal income driven by a semiconductor boom and a rapid decline in the won-dollar exchange rate.

According to the Bank of Korea's "2026 Second-Quarter National Income (Preliminary)" released on the 8th, second-quarter nominal GNI increased by 26.4% compared to the same period last year. The full first-half nominal GNI growth rate reached 21.8%.

Kim Hwa-yong, head of the Bank of Korea's National Income Division, stated, "The first-half nominal GNI growth rate remained high at 21.8%," adding, "If there are no unexpected shocks in the second half and exchange rate stability continues, it is highly likely that per capita GNI in dollar terms will exceed $40,000 this year."

Applying the government's projected nominal growth rate of 12.3% for this year to last year's nominal GNI of 2,717 trillion won yields an estimated current-year nominal GNI of approximately 3,051 trillion won. Dividing this by this year's projected population of 51.61 million results in a per capita GNI of about 59.1 million won in Korean currency.

Calculations indicate that if the annual average won-dollar exchange rate remains at or below 1,478 won, the $40,000 threshold can be surpassed. As of the 7th of this month, the year-to-date average exchange rate stood at 1,471.4 won.

The semiconductor boom simultaneously lifted national income and economic scale. Second-quarter nominal gross domestic product (GDP) rose by 26.4% compared to the same period last year, marking the highest growth rate in approximately 47 years since the third quarter of 1979 (27.7%). It also increased by 9.2% from the previous quarter.

The GDP deflator rose by 21.9% compared to the same period last year, reaching its highest level since the fourth quarter of 1980 (26.6%). This was largely due to a sharp 56.6% surge in the export deflator centered on semiconductors. Reflecting the impact of the Middle East war, the domestic demand deflator also rose by 3.6%.

Deputy Director Kim explained, "The expansion in second-quarter nominal GDP growth resulted from real GDP maintaining high growth rates while the GDP deflator surged significantly from 12.9% in the first quarter to 21.9% in the second quarter." He further noted, "The expansion in nominal GDP growth indicates improved corporate profitability centered on the semiconductor industry."

Performance improvements concentrated in semiconductors are now spreading to other sectors. Deputy Director Kim stated, "This quarter, not only did operating profits in semiconductor manufacturing increase substantially, but performance improvements are gradually expanding to non-semiconductor industries such as chemical products, transportation equipment manufacturing, and wholesale/retail services."

Real purchasing power also improved significantly. While second-quarter real GDP grew by 0.6% from the previous quarter, real gross domestic income (GDI) rose by 3.7%, and real GNI increased by 3.1%. This resulted from export prices rising more sharply than import prices, expanding real trade gains from 38.7 trillion won in the first quarter to 58.5 trillion won in the second quarter.

Deputy Director Kim explained, "Real GDI reflects improvements in real purchasing power due to better terms of trade, which is why it exceeded GDP growth rates." He added, "As export price growth outpaced import price growth, the improvement in terms of trade was larger in the second quarter than in the first."

Total operating surplus, a key indicator of corporate performance, surged by 18.5% from the previous quarter and 48.2% compared to the same period last year, reaching all-time highs since statistics began being published in 2010. Deputy Director Kim remarked, "Performance improvements are gradually spreading beyond semiconductors to chemical products, transportation equipment manufacturing, and wholesale/retail industries."

In contrast, the growth rate of employee compensation was only 1.9% from the previous quarter, the lowest since statistics began being published. Deputy Director Kim noted, "Corporate operating profits began increasing significantly starting from the fourth quarter of last year and the first quarter of this year," adding, "It takes some time for corporate income to transfer to individuals or household incomes and translate into consumption."