South Korea saw its worst economic performance in more than two decades last year, amid the COVID-19 pandemic.
The Bank of Korea said on Tuesday, that South Korea's GDP shrank one percent in 2020 compared to the previous year.
This is the first time the nation's economy has seen an on-year contraction since it shrank five.one percent during the IMF Crisis in 1998.
Last year's on-quarter GDP shrank 1.3 percent in the first quarter and 3.2 percent in the second quarter.
But GDP then grew in the third and fourth quarters, by 2.1 percent and 1.1 percent, respectively.
A recovery in exports drove economic growth in the fourth quarter despite the third wave of the pandemic.
"In the fourth quarter of last year, consumption and facilities investment contracted compared to the previous quarter, but exports continued to increase, and construction investment expanded."
Private consumption contracted by 1.7 percent on-quarter in the fourth quarter, as spending on restaurants, accommodation and transportation decreased.
But exports were up by 5.2 percent, mainly from increased exports of semiconductors and chemical products.
Looking over the whole of 2020, private consumption shrank 5 percent, marking the steepest fall since 1998.
Exports dropped 2-and-a-half percent, posting negative growth for the first time since 2009.
The central bank says while South Korea's contraction was smaller than other countries, COVID-19 is still having an impact on the economy.
"The third wave of the pandemic started to impact the domestic economy in November. Its influence was strongest in December, and it is still ongoing in January. With COVID-19 still ongoing, we need to be cautious about the economy's prospects."
Finance Minister Hong Nam-ki on Tuesday raised concerns over sluggish consumption,
and stressed that the priority is containing the spread of COVID-19 so economic activities can get back to normal.
Kim Jae-hee, Arirang News.