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Intelligence for Better Decision Making
| Domain | Causal Chain | Possible Outcome |
|---|---|---|
| Macroeconomics & Growth | (Semiconductor export boom ↑ → Terms-of-trade index ↑ → Current-account balance (% GDP) ↑ → Potential GDP growth revision ↑ → Real GDP growth ↑) | The enhanced terms of trade and external surpluses will underpin upward revisions to potential output and drive stronger real GDP growth. |
| Macroeconomics & Growth | (Memory chip price surge ↑ → Import-price pass-through ↑ → Headline CPI/Core CPI ↑ → Inflation volatility ↑ → Inflation-targeting credibility ↓) | Rising import-price pass-through and inflation volatility may erode confidence in the central bank’s ability to keep inflation near its 2 percent target. |
| Competitiveness | (Semiconductor export boom ↑ → Trade-openness & preferential access ↑ → Real export market-share change ↑ → High-value-added export share ↑ → Total-factor productivity level vs frontier ↑) | Greater preferential access and high-value trade gains will accelerate productivity convergence toward the global frontier. |
| Macroeconomics & Growth | (DRAM price surge–driven profits ↑ → Capital-formation rate ↑ → Business fixed-investment growth deviation ↑ → Private fixed-investment growth ↑ → Potential GDP growth revision ↑) | Surging profits will finance elevated business investment, prompting analysts to hike potential GDP growth estimates. |
| Macroeconomics & Growth | (Memory chip price surge ↑ → Global-value-chain reconfiguration velocity ↑ → FDI net inflow (% GDP) ↑ → Foreign-owned green-field project count ↑) | Accelerated value-chain shifts will draw substantial FDI and increase foreign-owned greenfield semiconductor projects. |
| Firms | (South Korean PPI inflation ↑ → Supply-chain restructuring cadence ↑ → Supplier-delivery-times index ↓ → End-to-end supply-chain lead-time deviation ↓ → Capacity-utilisation in manufacturing ↑) | Faster supply-chain restructuring and reduced lead-time variability will boost manufacturing capacity utilization. |
| Technology & Innovation | (Strategic-sector export risk ↑ → Dual-use export-control restrictiveness ↑ → Semiconductor fab utilisation rate ↓ → AI inference cost index shift ↑ → AI adoption GDP uplift ↓) | Tighter export controls will reduce fab utilization, raise AI inference costs, and dampen AI-driven GDP gains. |
Erudite Risk takes an all risks approach to intelligence reporting. We categorize key intelligence into one of 40 different risk intelligence categories.
The goal is to provide intelligence that allows decision makers to avoid being blindsided by what they may have missed, while informing them to make better decisions as well.
Erudite Risk also includes operations categories so you can monitor the environment for better decision making. Everything is tied together--what happens in risk affects operations and what happens in the market impacts risk profiles.
We categorize key intelligence into one of 30 different operations intelligence categories.
Different roles and functions within the organization can monitor different key issue areas. HR may monitor employment, wages, regulations, labor and management relations, etc., while P&L leaders may monitor overall developing trends.
Gwangju named Korea's first citywide autonomous driving test zone to challenge U.S., China leads
Joongang Ilbo | English | News | Jan. 23, 2026 | UndeterminedTech Development/Adoption
Gwangju Metropolitan City has been designated as South Korea's first citywide autonomous driving test zone to accelerate AI-powered vehicle development and close the technology gap with the United States and China. The Ministry of Land, Infrastructure and Transport announced that about 200 self-driving vehicles will operate on public roads across Gwangju starting in the second half of 2026. This initiative is part of a broader economic growth strategy aimed at boosting the country's competitiveness in autonomous driving by utilizing the entire city as a large-scale testing environment, similar to trials in San Francisco and Wuhan.
The government plans to appoint the Korea Automobile Testing and Research Institute to manage the program and will select about three autonomous driving companies through an open call by April. These companies will receive test vehicles based on their technical capabilities, beginning with autonomous driving accompanied by safety drivers and moving toward fully driverless operations after annual reviews. A standardized system will collect and preprocess driving data to train AI, with support for large-scale GPU-based training at the national AI data center. Additional measures include remote monitoring, safety management systems, and a specialized insurance product to mitigate compensation risks from accidents during testing.
South Korea has already implemented advanced regulatory frameworks, including safety standards for Level 3 conditional automation and performance certification for Level 4 automation, but has been limited to smaller testing zones until now. Officials emphasized that larger-scale real-road testing is essential for AI systems that learn from extensive data and make independent driving decisions. Land Minister Kim Yun-duk noted the urgent need to catch up with global leaders, characterizing Korea's current autonomous driving technology level as elementary compared to more mature development in the U.S. and China.
The Impact of the US National Security Strategy’s Blind Spot on North Korea
38 North | English | AcademicThink | Jan. 23, 2026 | North Korea
The latest US National Security Strategy (NSS) marks a significant shift in Washington’s approach to the Korean Peninsula by excluding North Korean denuclearization as a central concern and redirecting deterrence responsibilities primarily onto allies, especially South Korea. This shift reflects a reprioritization in US strategy that reduces direct engagement and increases South Korea’s burden in managing North Korea, resulting in a more volatile and unpredictable security environment.
North Korea views this strategic retrenchment as an opportunity to strengthen its position by adopting a more confrontational stance toward South Korea, potentially codifying a hostile inter-Korean doctrine at its upcoming Ninth Party Congress. Its military provocations serve a dual purpose: challenging South Korea’s control over contested maritime and air defense zones in a calculated manner to avoid large-scale escalation, and provoking political divisions within South Korea related to responses and the credibility of US extended deterrence.
South Korea is responding to these provocations by significantly increasing its defense budget and investing in advanced military capabilities, signaling a shift toward greater self-reliance and reduced dependence on the US nuclear umbrella. Discussions on indigenous nuclear options and strategic assets have entered mainstream political debate, reflecting growing doubts about the reliability of US deterrence.
The absence of North Korea from the US NSS increases the risk of an accelerated arms race on the Peninsula, compounded by US global strategic actions that raise perceptions of unpredictability and willingness to use force. This dynamic incentivizes both Pyongyang and Seoul to engage in competitive military buildup and riskier postures, especially around sensitive zones like the Northern Limit Line and Korea Air Defense Identification Zone, with a heightened chance of destabilizing escalation.
Underlying this situation are flawed assumptions within US policy that ambiguity and burden-shifting will maintain stability. Without clear communication, senior-level coordination, and explicit crisis management policies—including well-defined red lines—burden-shifting encourages risk-taking by all parties. The evolving arms competition and alliance asymmetries on the Peninsula increase the likelihood of costly miscalculations and military adventurism unless strategic signaling and allied coordination improve significantly.
Firefighters battle wildfire raging in Busan for 2nd day
Korea Herald | English | News | Jan. 23, 2026 | Natural Disasters
A wildfire has been burning on a mountain in Busan for a second day, originating at a tile factory in Gijang county on Wednesday evening. The fire spread to a nearby hill, prompting the evacuation advisory for around 30 people from a local resort. No casualties have been reported so far.
As of early Thursday morning, 65 percent of the 11-hectare fire was under control, with around 340 personnel including firefighters, police, and forestry officials working to contain it. Authorities plan to deploy 17 helicopters, five of which are military, to combat the fire amid strong wind forecasts of up to 15 meters per second.
The Korea Forest Service and local fire authorities have warned of dry conditions in Busan, increasing wildfire risks in the area. Efforts continue to prevent further spread of the blaze amid these challenging weather conditions.
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