November 26, 2024

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Hyundai Motor Group’s headquarters in Yangjae, Seocho-gu, Seoul (Hyundai Motor Group)

Hyundai Motor Group’s economic impact on South Korea's economy outpaced that of Samsung Electronics for the first time last year, data showed Wednesday.

The combined economic contribution of Hyundai and its smaller affiliate Kia came to 164.6 trillion won ($124.7 billion), going beyond the 148.1 trillion won of Samsung Electronics, according to data from market tracker CEO Score.

The economic impact of companies measures the wealth they create and return through local business activities. It is calculated by adding up the total amount a company has spent paying all its stakeholders, including: partner companies, staff and executives, the government, shareholders, creditors and society via corporate social responsibility activities and donations.

In 2021, Hyundai, the world's third-largest carmaker, recorded 138.9 trillion won, 10 trillion won less than that of Samsung, the world’s largest memory chip maker.

Among the top 100 Korean companies in terms of sales revenue, Samsung Electronics showed the biggest drop in economic impact in 2022, down by 7.2 trillion won from a year earlier.

Although Samsung saw an increase in expenses in other sectors, the amount of corporate taxes it paid was drastically cut by 22.7 trillion won, which led to an overall drop in expenses and therefore its overall economic impact, data showed.

SK Telecom recorded a 1.8 trillion won drop in expenses in the cited period as well, followed by SK Networks, Samsung Electro-Mechanics and LG Display, which also saw their expenses fall -- and thus their economic impact -- in that order.

On the other hand, refiner GS Caltex witnessed the largest growth in its economic impact, logging 54.3 trillion won, a jump of 23 trillion won compared to 2021. Its local rivals SK Energy and S-Oil came in at second and third place, posting growth of 21.6 trillion won and 13.9 trillion won, respectively.

Overall, the top 100 companies’ combined economic wealth returned to stakeholders as economic impact surged on-year by 20.7 percent to 1,472.8 trillion won last year.

By category, the greatest expense of 1,244.4 trillion won was paid to partner companies, followed by expenses paid to company staff and executives, shareholders, government, creditors and finally, society.

Returns to creditors, including interest paid to financial institutions, saw the highest growth of 36.2 percent from a year earlier. Expenses paid to the government, which consist of corporate taxes and utilities, on the other hand, witnessed the biggest drop -- of 65.5 percent.

By Byun Hye-jin (hyejin2@heraldcorp.com)