SEOUL—South Korea's economic standing is facing a potential setback as the International Monetary Fund (IMF) projects a significant drop in its per capita Gross Domestic Product (GDP) ranking this year, forecasting that it will be surpassed by Taiwan for the first time since 2003.

According to the IMF’s latest World Economic Outlook report, released on October 15, South Korea's per capita GDP is estimated to fall to $35,962 in 2025, a 0.8% decrease from $36,239 last year. This is expected to push South Korea's global ranking among 197 economies down three notches, from 34th to 37th place. The outlook is gloomy for the future, with the IMF predicting a continued decline, potentially seeing the nation fall outside the top 40 by 2029.

In sharp contrast, Taiwan is on a rapid upward trajectory. The IMF forecasts Taiwan’s per capita GDP to surge by an impressive 11.1% to $37,827 this year, up from $34,060 in 2024. This robust growth is expected to elevate its global ranking three spots from 38th to 35th, officially overtaking South Korea. This reversal, which follows a period of South Korean leadership since 2003, marks a significant shift in the economic balance between the two export-driven Asian nations.

The differing growth projections highlight the underlying issues. While major overseas investment banks (IBs) forecast Taiwan's real GDP growth rate this year to average around 5.3%, South Korea's corresponding figure is a modest 1.0%. This follows South Korea's economic growth rate of 1.4% last year, which trailed behind Japan’s 1.9% for the first time since 1998.

Looking ahead, the IMF projects Taiwan's strong momentum to continue, anticipating its per capita GDP will exceed the $50,000 mark by 2030, reaching $50,252. The forecast paints a clear picture of divergent economic fortunes, raising concerns in Seoul about the nation's long-term growth potential and global competitiveness.

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