Latest news with #Korea-Japan
Korea Herald
3 days ago
- Business
- Korea Herald
KCCI chief suggests EU-style economic bloc between Korea, Japan
Chey Tae-won says tie-up between neighbors in AI, manufacturing could be key to weathering global economic storm Chey Tae-won, chairman of SK Group and the Korea Chamber of Commerce and Industry, doubled down on his proposal for a Korea-Japan economic bloc that is akin to the EU, stressing that the two nations must strengthen cooperation in AI and manufacturing sectors as global economic uncertainties intensify. Envisioning a bloc that would unite the two neighbors — both grappling with stagnant domestic economies, aging population and rising global trade barriers — Chey has been advocating such a union would create a $6 trillion economic zone, making it the world's fourth-largest economy, one that would be better places to combat these shared challenges. "The question is: Is Korea okay the way it is? If not, we need to explore new options that we have never tried before," Chey told reporters during a press conference Thursday on the sidelines of the 48th KCCI summer forum held in Gyeongju, North Gyeongsang Province. 'A Korea-Japan economic bloc could be one of those options, and it can grow into a community like the EU,' he added. Chey acknowledged the proposal may meet with mixed public sentiment, but noted that many Japanese business and political leaders he met were not opposed to the idea. He met with Japanese Prime Minister Shigeru Ishiba in May, advocating for deeper economic cooperation between the two countries. 'Japan thinks a lot more in terms of economic security and it is my understanding that Prime Minister Ishiba is also putting a lot of efforts and interest into it as well," he said. Chey pinpointed artificial intelligence and manufacturing as two critical areas where Korean and Japanese expertise could combine forces. 'To do AI well, we have to join hands with Japan and exchange data with each other,' he said, noting Korea's domestic industry, manufacturing scale and data alone are not big enough on their own. 'When Korea and Japan combine data together, we can even achieve at least some competitiveness," he said. 'There are many issues South Korea cannot resolve alone.' He believes AI could be the very key to tackle Korea's dwindling manufacturing industry. 'In this era of AI, if Korea fails to rebuild its manufacturing industry through AI, a large portion of Korea's manufacturing industry could be wiped out within a decade, he said. 'It's a grim scenario, but AI is our only hope at this point.' Chey raised alarm over China's rapid adoption of AI. "In AI, China is catching up and applying it faster than we are. Korea needs to catch up as soon as possible to stay competitive," he said. On the domestic front, Chey called for efforts to scale Korea's AI ecosystem, including the development of infrastructure, the cultivation of talent and the nurturing of a vibrant startup environment. 'What I want to ask the government is this: Create a market. We need public sector-led AI projects," he said. "Once these projects are launched, startups, mid-sized firms and large companies can all participate and make something. That's how we can increase the number of people with experience and training in AI." To that end, infrastructure is critical, he added. 'We need to make many applications for accessible AI, but more importantly, we need the infrastructure to support them, like AI data centers with GPU capacity," he added. Such resources should be publicly available for startups and SMEs to train AI models and develop practical product. Chey, who is hosting the upcoming APEC CEO Summit in October in Gyeongju, said he hoped the event would promote international cooperation not only in AI, but also in solving broader challenges such as trade issues. 'One thing I would like to see come out of APEC is a clear solution to the tariff issues,' he said but adding it would be ideal if the matter could be resolved before the summit. 'If tariff issues are resolved, it would be a strong signal that economic threats are easing. Beyond tariffs, Chey said he expressed home for new types of cooperation in AI, semiconductors, shipbuilding, steel and automobiles. Chey said he is putting all out efforts to invite many global business leaders to the upcoming meeting. "Our approach now is to ask the (leaders) who they want to meet when they come to Korea," he said. "If they believe they can meet someone important to them here, the likelihood of attendance will increase. Because ultimately, they need a clear reason to come."
Korea Herald
25-06-2025
- Business
- Korea Herald
Skilled immigration, Japan ties key to rebooting Korea's growth: KCCI
New report urges mega sandbox reforms, reshoring of fabs, $6tr Korea-Japan bloc to unlock new growth engines South Korea needs to attract 5 million highly-skilled foreign professionals and forge an economic alliance with Japan to tackle its demographic headwinds and counter rising trade protectionism, the Korea Chamber of Commerce and Industry proposed Wednesday. In a policy booklet roughly translates to "New Order, New Growth" delivered Tuesday to the government, parliament, and presidential office, the business lobby outlined structural fixes to help Korea escape the trap of slowing growth and a shrinking labor force. 'This is a time when growth is more necessary than ever. The global landscape is shifting dramatically, and the Korean economy, having failed to bring about lasting change, now faces the risk of zero growth,' wrote Chey Tae-won, chairman of SK Group and KCCI, in the booklet's preface. 'We must work with the new government to build future growth engines for the Korean economy. It's essential to find actionable solutions to reduce high costs by joining hands with global partners.' The proposal comes as the Lee Jae Myung administration works to finalize its national policy roadmap, with input from a new planning committee that is actively soliciting feedback from business and civil society. Among Korea's most pressing structural concerns is a declining working-age population coupled with a limited domestic market. The KCCI argued this can be alleviated by attracting skilled talent from countries such as Vietnam, Indonesia and Malaysia. Beyond addressing labor shortages, an influx of foreign professionals could be expected to stimulate consumption and increase tax revenues. Supporting this approach, studies cited in the proposal showed that a 3 percent increase in skilled and unskilled foreign labor leads to GDP growth of 1.46 percent and 0.85 percent, respectively, in the US, with comparable figures in Japan, underscoring the economic benefits of immigration. The plan recommends visa reforms inspired by Germany's Green Card system tailored for IT professionals, along with family friendly settlement policies. It also proposed reshoring major overseas semiconductor fabs to Korea to attract highly skilled workers on a large scale. In tandem with immigration, the KCCI urges Korea to deepen economic cooperation with Japan, a nation grappling with similar demographic and industrial challenges. The report argues that aligning the two economies could create a $6 trillion economic bloc, eclipsing Germany and positioning Korea and Japan as global rule-makers in trade and regulatory standards. 'If Korea and Japan become each other's second-largest domestic market, they can enjoy productivity gains even in aging societies,' the report said. Joint LNG procurement and coordinated production networks spanning Asia, the US, and the EU could lower costs and enhance competitiveness. The proposal envisioned an emerging Asian economic zone — including Korea, Japan, and other developing countries that could grow to $47.7 trillion by 2030, becoming the world's largest economic region, 1.3 times the size of the US economy. The booklet also called for a fundamental shift away from Korea's longstanding dependence on goods exports, which have fueled remarkable growth -- over 10,000 percent in GDP over 70 years -- but are now hampered by shrinking profit margins and rising protectionism. Manufacturing profitability has steeply declined, with net income per 10,000 won ($7.35) in sales dropping from 830 won in 1995 to just 320 won in 2024, reflecting structural challenges in the sector. To counter this, the KCCI advocated boosting service exports and primary income through strategic overseas investments, pointing to Japan's returns from foreign assets and the UK's robust service economy as benchmarks. One example the group suggested was the industrialization of Korean food and culture exports, including recipe licensing, cooking classes, kitchenware, and interior design, aiming to capture untapped non-tariff export value and open new global markets. To implement these changes, the KCCI proposed expanding Korea's regulatory sandbox into a 'mega sandbox' model. This framework would offer wide-ranging regulatory exemptions, aggressive private sector incentives, talent matching platforms and global-standard living conditions to attract and retain top international talent. The 250-page report was compiled by 13 experts, ranging from think tank researchers and law professors to industry consultants, including Kim Chang-wook, Boston Consulting Group's semiconductor lead in Korea, Suh Dong-hyun, economist at the Bank of Korea, and Kwon Seok-joon, a chemical and polymer engineering professor at Sungkyunkwan University.
Korea Herald
23-06-2025
- Business
- Korea Herald
Cho Hyun: Veteran diplomat with broad global, trade experience
Cho Hyun, a veteran diplomat with extensive experience in both bilateral and multilateral diplomacy — including key postings at the United Nations — and deep expertise in trade issues, has been tapped as the Lee administration's first foreign minister. Cho previously held the roles of first and second vice foreign minister, and served as South Korea's ambassador to the UN — all under the liberal Moon Jae-in administration, overlapping with the first Trump presidency. 'He is expected to take an active role in addressing key pending matters such as tariff negotiations and Middle East affairs,' Presidential Chief of Staff Kang Hoon-sik said during a briefing Monday. Cho's diplomatic career includes serving as ambassador to India from 2015 to 2017, and as ambassador to Austria and permanent representative to international organizations in Vienna from 2011 to 2014. He also held the post of deputy permanent representative to the UN in New York from 2006 to 2008. Within the Foreign Ministry, Cho has held numerous high-level positions, including deputy minister for multilateral and global affairs, ambassador for energy and resources, and director-general of the Ministry's International Economic Affairs Bureau. Cho was involved in negotiations for a Korea-Japan free trade agreement and served as chief negotiator for the Korea-Mexico FTA. Cho received a Ph.D. in international politics from the University of Toulouse in France in 2008, and holds M.A. degrees from the School of Political Science in Paris and from Columbia University. Cho earned his bachelor's degree in political science and diplomacy from Yonsei University in Seoul.
Hindustan Times
18-06-2025
- Business
- Hindustan Times
In South Korea, continuity with cautious progressivism
Earlier this month, South Korea elected a new president, Lee Jae-myung, in a snap election, ending the six-month political crisis that had engulfed the country. This crisis began with then President Yoon Suk Yeol's declaration of martial law in December last year, followed by his impeachment by the parliament and subsequent removal from office by the constitutional court. The high voter turnout -- nearly 80% -- illustrated the public's deep concern over democracy and desire for change. Lee Jae-myung, representing the opposition Democratic Party, won with an 8-percentage vote margin against the ruling People's Power Party candidate, Kim Moon-soo, and Lee Jun-seok of the Reform Party, who secured 41% and 8.3% of the vote, respectively. Lee's victory marks a notable comeback, considering he had lost to Yoon in the 2022 election by less than a single percentage point. The backlash against the declaration of martial law undoubtedly played a crucial role, galvanising support for the opposition. Internal divisions within the People's Power Party, particularly concerning Kim Moon-soo's candidature, further weakened its position. The Reform Party, a splinter group from the People's Power Party led by Lee Jun-seok, also siphoned off conservative votes. President Lee faces a daunting array of challenges. The most pressing need is to unify a deeply divided nation. Notably, significant segments of the population remained supportive of Yoon Suk Yeol through his impeachment and removal. Fostering a sense of national unity will be a critical task. Economic uncertainties also loom large. South Korea's economy has seen a growth slowdown amid the impact of US President Donald Trump's tariff war and an intensifying trade war between the US and China. On the positive side, unlike Yoon, who believed his agenda was being stifled by the Opposition's supermajority in parliament and resorted to the extreme measure of declaring martial law, Lee will likely benefit from his party's dominance in the parliament. Beyond domestic issues, Lee will also have to navigate a complex, shifting regional environment in the wake of Trump's return to office, an intensifying US-China rivalry, and a reinvigorated North Korea with its close security alignment with Russia. Over the last three decades, government transitions in South Korea have been marked by dramatic shifts in foreign policy. While both conservatives and progressive camps view Seoul's alliance with the US as central to security policy, they differ on the extent to which Korean foreign policy is centred on the alliance, with the progressives seeking more autonomy. Lee's progressive predecessor, Moon Jae-in (president during 2017-22), adopted a region-focussed foreign policy approach that prioritised engagement with North Korea, balancing relations with the US and China, and diversification of South Korea's diplomatic ties beyond its traditional partners. Amid deterioration of Korea-Japan relations and a cautious engagement with the US's Indo-Pacific strategy, his New Southern Policy put renewed focus on Asean and India. However, the conservative Yoon administration adopted a globally-oriented foreign policy agenda with the alliance with the US at its core and an outreach to Nato amid the Russia-Ukraine war. While significantly improved ties with Japan paved the way for US-Japan-South Korea trilateral security cooperation and a proactive Indo-Pacific strategy, he took a principled reciprocity-based approach to China and a hawkish stance towards North Korea. The temptation to continue with the progressive foreign policy template will be quite natural, but President Lee is likely to be more pragmatic with the changed regional and international environment. His choice of experienced, retired diplomats as advisors during the campaign and likely for key foreign policy positions in the administration signals this. A pragmatic foreign policy will entail a moderate stance on North Korea, less engagement-focused than President Moon but also less hawkish than Yoon. However, there will be significant continuity from the Yoon presidency on the US-Korea alliance, building a forward-looking partnership with Japan, and promoting US-Japan-Korea trilateral cooperation. Instead of a broader Indo-Pacific focus, Lee will likely concentrate on the role of the US-Korea alliance and the US-Japan Korea trilateral to address Korean Peninsula issues, particularly North Korea's nuclear programme. This allows flexibility in improving relations with China and Russia. During the campaign, Lee also articulated the need to strengthen ties with the Global South. This might look like an expansive version of Moon's New Southern Policy driven by twin objectives of diplomatic and economic diversification and reducing Seoul's dependence on the great powers. The six-month-long political upheaval — from the declaration of martial law to a peaceful snap election — illustrates the ability of Korean democracy to withstand internal shocks. Only time will tell how and whether President Lee can successfully unite the country and adjust South Korea's position within the evolving regional geopolitical landscape. Jojin V John is assistant professor and director, Korea Centre, Mahatma Gandhi University, Kerala. The views expressed are personal.
UPI
18-06-2025
- Politics
- UPI
G7 Summit: South Korea, Japan take initial step toward renewed ties
SEOUL, June 18 (UPI) -- South Korean President Lee Jae-myung and Japanese Prime Minister Shigeru Ishiba held their first bilateral summit Tuesday on the sidelines of the G7 meeting in Toronto--marking a cautious but notable step toward resetting long-strained relations between the two neighboring countries. Lee, whose prior remarks on Japan drew criticism from Japanese conservatives, signaled a shift toward a more pragmatic diplomatic posture during the meeting. His tone in Toronto suggested a willingness to move forward with Japan despite longstanding tensions. While both leaders expressed optimism about building a "future-oriented partnership," concrete outcomes may emerge as talks continue. Historical grievances, particularly unresolved matters such as wartime forced labor, continue to cast a shadow over the relationship. Lee reaffirmed South Korea's stance on these issues, emphasizing the importance of national sentiment and historical accountability. At home, his administration must also navigate a politically divided landscape, as public opinion in South Korea remains deeply sensitive to issues related to historical disputes with Japan. While the meeting carried clear symbolic weight, the path forward will depend on whether the two governments can translate goodwill into sustained diplomatic progress. The coming months will reveal whether this summit marks the beginning of a new chapter in Korea-Japan relations -- or simply a fleeting moment of diplomatic engagement.
