SOUTH KOREA PERSPECTIVE

Seoul, June 22, 2026. The numbers speak for themselves: between June 1 and 20, South Korean exports reached 62 billion dollars, an absolute record for a twenty-day period, shattering the previous record of 54.3 billion established in March. Behind this spectacular performance, one sector dominates overwhelmingly: semiconductors. Their shipments surged 188.4% year-over-year, hitting 22.5 billion dollars and now representing 41.2% of the country's total exports, according to provisional data from the Korea Customs Service released Monday.

This dynamism unfolds precisely at the heart of the technological confrontation between Washington and Beijing. As China announces new export controls and targeted sanctions against American firms, Seoul monitors the ripple effects on its own value chains. Samsung Electronics and SK Hynix, two pillars of global chip production, face exposure to both the Chinese market and American export restrictions targeting China. This dual positioning places South Korea in a delicate spot: capitalize on exploding global demand for semiconductors while navigating between allied nations and commercial partners locked in confrontation.

The geopolitical context further complicates the equation. Seoul's stock market opened lower Monday morning, weighed down by uncertainties surrounding US-Iran negotiations in Switzerland, before rebounding precisely thanks to semiconductors. The KOSPI gained 1.03%, reaching 9,145.79 points mid-morning, buoyed by SK Hynix (+4.67%), SK Square (+8.48%), and LG Electronics (+11.82%). A clear signal: South Korean markets are betting on resilient semiconductor demand regardless of diplomatic turbulence.

But imports reveal the flip side. They rose 23.2%, to 44.5 billion dollars, driven notably by energy purchases (+19.9%) due to the Iran-US conflict and a weakened won—the South Korean currency traded at 1,538.3 won to the dollar Monday morning, down 10.8 won. The trade surplus of 17.5 billion remains comfortable, but inflationary pressure from energy constrains margins.

Facing this environment, Foreign Minister Cho Hyun announced the creation of a dedicated task force to identify country-specific Middle East reconstruction needs, facilitating South Korean firms' participation. "Our responses to the crisis have reinforced the perception that South Korea is a reliable partner standing alongside nations in difficult moments," he stated at a press conference. A strategic ambition that fits directly into Sino-American rivalry: Seoul intends to capture Middle East reconstruction markets, a space where Washington and Beijing are also competing for influence.