February 23, 2018 / 7:48 AM / 23 days ago

South Korea says Olympics likely boosted first-quarter GDP year-on-year growth by 0.2 percent points

SEOUL (Reuters) - South Korea said that hosting the Winter Olympics will give a lift to the country’s economic growth rate this year.

Feb 9, 2018; Seoul, South Korea; People eat, talk and watch the opening ceremony of the Pyeongchang 2018 Olympic Winter Games on TV at the Park Ga Ne Bin Dae Tteok restaurant in the Gwangjang market in Seoul, South Korea. Mandatory Credit: Eric Seals-USA TODAY Sports

A statement from the presidential Blue House said that expenditures from the Pyeongchang Olympics and increased tourism will likely mean a boost of 0.2 percentage points to the annual growth rate for the first quarter.

It said there is likely to be a 1.4 trillion won ($1.30 billion) rise in consumption - 500 billion won in tourism related profits and 900 billion won in money budgeted this year to hold the Games.

For full-year 2018, the Winter Olympics is estimated to contribute to around a 0.05 percentage point bump in growth rate of gross domestic product, the Blue House said.

South Korea’s economy is relying on robust domestic consumption to prop up growth in the first quarter after exports, grounded by struggling car exporters, gnawed at activity in the fourth quarter of 2017.

In the final quarter of last year, South Korea’s economy grew 3.0 percent from the previous year, the slowest in two quarters.

The Pyeongchang Winter Olympics, which kicked off on Feb. 9, end on Sunday.

(This story corrects government estimate to around 0.05 percentage point, from 0.05 to 0.06 percentage point in paragraph four)

Reporting by Christine Kim; Additional reporting by Joyce Lee; Editing by Richard Borsuk

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