South Korea, once regarded as the front-runner and a model of economic development among the “Four Asian Tigers,” is now taking a completely different path from the other three.

While Taiwan, Singapore, and Hong Kong are seeing stronger-than-expected growth and raising growth forecasts, Korea is struggling to escape from zero percent growth even with full effort this year.

The International Monetary Fund (IMF), which had projected that Korea would surpass $40,000 in per capita gross domestic product (GDP) by 2027, pushed that estimate back by two years to 2029 in April 2025.

If Taiwan’s per capita GDP surpasses $40,000 next year as the Taiwanese government expects, Korea will lag three years behind Taiwan.

Even the term “super gap,” once used to describe Korea’s dominance in the global memory semiconductor market, is now difficult to use, as Korea is now in a position of chasing Taiwan in the field of advanced semiconductors.

According to market research firm TrendForce, Taiwan Semiconductor Manufacturing Co. (TSMC) held a dominant 67.6 percent market share in foundry services in the first quarter of 2025.

This dwarfs Samsung Electronics Co.’s 7.7 percent share and raises concerns that Samsung could even be overtaken by China’s Semiconductor Manufacturing International Corp. (SMIC), which holds 6 percent.

Singapore and Hong Kong are also maintaining solid growth.

Singapore’s Ministry of Trade and Industry announced last week that the country’s GDP grew 4.4 percent in the second quarter from a year earlier.

Reflecting this, it raised its 2025 economic growth forecast from 0-2.0 percent to 1.5-2.5 percent.

Hong Kong’s economy, supported by increased exports and consumption in the second quarter, recorded growth of 3.1 percent, exceeding market expectations.

According to the Hong Kong Census and Statistics Department on August 1, the territory’s second-quarter GDP grew 3.1 percent year-on-year, surpassing both Bloomberg’s forecast of 2.8 percent and its first-quarter growth rate of 3 percent.

Analysts suggest that Korea’s divergence from the others stems from complacency -resting on the achievement of being the only one among developing nations to join the ranks of advanced economies - while falling behind in innovation.

According to the annual World Competitiveness Ranking published by the International Institute for Management Development (IMD) in Switzerland, Korea ranked 27th out of 69 countries this year, falling seven places from the previous year.

The main factor behind this decline in national competitiveness was the sharp deterioration in corporate efficiency.

In particular, corporate responsiveness to opportunities and threats plunged from 17th to 52nd place in just one year.

This stands in stark contrast to Singapore (2nd), Hong Kong (3rd), and Taiwan (6th), which all remain in the top tier.

The Korea Development Institute (KDI), a state-run think tank, recently maintained its forecast for Korea’s economic growth this year at 0.8 percent.

While the country’s second-quarter growth rate turned out better than expected and the outcome of tariff negotiations with the United States was not unfavorable, the institute decided to hold its forecast steady due to the extremely weak construction sector.

KDI also expressed concern that the new government’s tough stance on industrial accident fatalities could further depress domestic construction investment.

“When safety accidents occur, construction work is sometimes halted. We factored that into our outlook and made a significant downward adjustment to construction investment,” said Jung Kyu-chul, head of KDI‘s economic outlook office.

The Bank of Korea, which also projects the country’s economic growth to be 0.8 percent this year, is expected to release a revised outlook soon.

However, with domestic demand - including construction investment - still weak and uncertainties such as semiconductor tariffs lingering, most analysts expect that any adjustment will amount to only a minor revision.

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