South Korea

Yonhap | English | News | Dec. 12, 2025 | Supply Chain Issues

Senior diplomats from South Korea and the United States held the 10th Senior Economic Dialogue in Washington on December 10, focusing on enhancing economic security and securing "trusted" supply chains. The talks followed a bilateral trade and investment agreement finalized during President Lee Jae Myung and U.S. President Donald Trump's summit in late October. Both parties emphasized the need for joint economic security measures and discussed strengthening economic and national security alignment to maintain collective competitiveness and secure supply chains.

The two countries explored cooperation to address unfair trade practices and non-market policies, with particular attention on collaboration regarding critical minerals. U.S. official Jacob Helberg praised South Korea's leadership on resilient supply chains in regional and multilateral forums. The dialogue reaffirmed commitments made during summits in August and October, which have contributed to modernizing the U.S.-ROK Alliance.

Under the trade and investment deal, South Korea pledged to invest $350 billion in the U.S., including $150 billion in shipbuilding and another $200 billion in other sectors. In exchange, Washington agreed to reduce reciprocal tariffs on Korean goods from 25 percent to 15 percent. The State Department described the agreement as central to progress in reciprocal trade, energy security, shipbuilding, and emerging technologies. Discussions also covered South Korean investments in American manufacturing and efforts to facilitate Korean business travel to the U.S.

Yonhap | English | News | Dec. 12, 2025 | Geopolitical Conflict and Disputes

South Korea's Second Vice Foreign Minister Kim Jina arrived in Washington on December 10, 2025, to urge the United States to swiftly implement an agreement enabling South Korea to enrich uranium and reprocess spent nuclear fuel for peaceful purposes. This request follows a prior agreement between the two countries, and Kim emphasized the need to start substantive discussions by assigning South Korea's counterpart in the process.

The upcoming 10th Senior Economic Dialogue (SED) between Kim and U.S. Under Secretary of State for Economic Affairs Jacob Helberg will focus on enhancing bilateral economic and industrial cooperation. Topics expected to be covered include shipbuilding, energy, cutting-edge technologies, critical minerals, and small modular reactors. However, the issue of South Korea's ambition to build nuclear-powered submarines will not be discussed during the SED, as it is considered a military matter slated for separate talks involving South Korea's National Security Adviser Wi Sung-lac.

The backdrop to this diplomatic activity includes a November 13 joint fact sheet where the U.S. expressed support for South Korea's civil nuclear fuel cycle activities, marking a departure from previous restrictions under the bilateral nuclear energy pact. South Korea is seen as an important partner in the U.S.'s broader "nuclear energy renaissance," with cooperation anticipated to benefit both nations. After the SED, Kim will represent South Korea at the "Pax Silica" artificial intelligence summit later in the week.

Joongang Ilbo | English | News | Dec. 12, 2025 | UndeterminedFinancial System Problems

In November 2025, overall household loan growth in South Korea slowed to an increase of 4.1 trillion won compared to 4.9 trillion won in October, driven by tighter banking regulations and a government-imposed annual cap. However, nonbank institutions such as insurance companies, mutual finance firms, and credit card companies saw a significant surge in lending, rising by 64 percent from 1.4 trillion won to 2.3 trillion won. Mutual finance firms contributed 1.4 trillion won to this growth, with insurers adding 500 billion won.

The slowdown was especially pronounced in bank-issued mortgage loans, which fell from 2 trillion won in October to 700 billion won in November, the lowest since March 2022. In contrast, mortgage loans from nonbank institutions increased sharply from 1.2 trillion won to 1.9 trillion won, fueled by strong demand in Seoul and surrounding real estate markets. While regulatory measures have slowed housing price increases overall, some key areas continue to experience steady or rising prices.

Other loan categories, including unsecured loans, also grew, reaching 1.2 trillion won in November, supported by increased investment activity in domestic and overseas stock markets, although volatility concerns remain. Financial authorities postponed the third phase of the stress debt service ratio (DSR) regulation for home loans in nonmetropolitan areas by six months, allowing existing, less stringent rules to apply through June 2026 due to sluggish housing markets outside the capital region. The stress DSR applies a hypothetical higher interest rate to ensure borrowers’ ability to repay under adverse conditions, helping to maintain financial stability.