Korea’s GNI stalls in $30,000 band as experts urge reforms

Mar 11, 2026, 08:22 am

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A view of the Bank of Korea headquarters in Seoul. / Bank of Korea

South Korea’s per capita income has remained in the $30,000 range for more than a decade, as high exchange rates and slowing economic growth continue to limit gains, prompting experts to call for urgent regulatory easing and structural reforms.

According to the Bank of Korea’s preliminary national income data for the fourth quarter and full year of 2025, released on March 10, the country’s gross national income (GNI) per capita reached $36,855 last year, up just 0.3 percent from the provisional figure of $36,745 in 2024.

South Korea’s per capita GNI first exceeded $30,000 in 2014, reaching $30,798, and peaked at $37,898 in 2021. However, the figure fell to $35,229 in 2022 as the Korean won weakened following U.S. interest rate hikes, and growth has since slowed.

The central bank said the strong U.S. dollar and the weak Korean won were key factors behind the sluggish growth in dollar-denominated income. Although real GDP growth reached 1.0 percent last year and income from overseas investments increased, the annual won–dollar exchange rate rose 4.3 percent, reducing gains when measured in dollars.

In contrast, income measured in Korean won rose more noticeably. Per capita GNI increased 4.6 percent, from 50.12 million won in 2024 to 52.42 million won last year. While nominal GDP in won terms rose 4.2 percent, GDP measured in dollars actually declined by 0.1 percent.

South Korea’s per capita income is expected to remain below that of Japan and Taiwan last year. Japan had lagged behind South Korea for the previous two years due to prolonged economic stagnation, but a revision of its GDP base year expanded the estimated size of its economy, pushing its per capita GNI to the low $38,000 range.

Taiwan has seen faster income growth. After surpassing $30,000 in per capita GNI in 2021, Taiwan climbed to $40,585 last year, crossing the $40,000 threshold in just four years.

Experts say exchange rate fluctuations played a major role in slowing income growth but also point to deeper structural issues, including outdated regulations and delayed industrial restructuring.

Yang Jun-seok, a professor of economics at The Catholic University of Korea, said regulations originally designed to protect the public are now restricting investment and innovation. He cited the example of the TADA ride-hailing service, which faced regulatory barriers that limited the development of new industries.

Kang In-soo, an economics professor at Sookmyung Women’s University, said South Korea has not sufficiently restructured its key industries over the past two decades.

“New industries have emerged, but the process of phasing out declining sectors has been relatively slow,” he said.

Experts argue that reaching the $40,000 per capita income level will require regulatory reforms and proactive industrial restructuring aligned with global economic trends.

Kang Sung-jin, a professor at Korea University, said government investment programs are important but stressed that policies should also focus on creating a more flexible regulatory environment that encourages private-sector investment.

The Bank of Korea projected that South Korea could reach $40,000 in per capita GNI by 2027, assuming exchange rate fluctuations remain limited. However, the central bank warned that external factors—such as geopolitical tensions in the Middle East—could negatively affect domestic growth and inflation if they persist for an extended period.

In response, the government plans to operate a 100 trillion won financial market stabilization program and provide financial support through policy banks for companies affected by developments in the Middle East.

#gross national income #GNI per capita #South Korea economy #exchange rate #Bank of Korea