For the first time, South Korea’s Gross National Income (GNI) per capita has topped that of Japan.
On June 5, the Bank of Korea (BOK) revealed that South Korea’s GNI per capita was $36,194, surpassing Japan’s $35,793. GNI per capita is calculated by adding up all the incomes earned by a country’s residents, both domestically and internationally, and dividing by the population. It is often used to compare living standards across countries. Among countries with more than 50 million people, South Korea ranks sixth in GNI, following the United States, Germany, the United Kingdom, France, and Italy.
This shift in GNI per capita is attributed to South Korea’s continuous growth and Japan’s extended stagnation. In the mid-1990s, Japan’s GNI per capita exceeded South Korea’s by more than $30,000. However, due to long-term economic stagnation, Japan’s national income has fallen from over $50,000 to around mid-$30,000. During the same period, South Korea’s GNI per capita, which was in the $10,000 range, has tripled.
The significant depreciation of the Japanese yen and the BOK’s revision of the base year for GDP calculations also influenced these figures. The base year is the reference year used in the BOK’s statistics and is updated every five years to account for the effects of new industries. As a result of this revision, last year’s nominal GDP increased by 7.4%, rising from 2,236 trillion won (about $1.63 trillion) to 2,401 trillion won (about $1.75 trillion). South Korea’s global GDP ranking improved from 14th to 12th, surpassing Australia and Mexico. According to Choi Jung-tae, head of the national accounts coordination team of the BOK Economic Statistics Department, “Assuming the exchange rate stabilizes, it is expected that GNI per capita will reach $40,000 within a few years.”
