attainable repercussions on the worldwide and Italian financial system” | EUROtoday

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Tuesday evening’s coup in South Korea may profoundly alter the way forward for one of the crucial dynamic and technologically superior international locations on the planet. With a nominal GDP estimated at round $1.8 trillion in 2023, South Korea is Asia’s fourth largest financial system and one of many ten largest globally. This yr, nonetheless, financial development has slowed considerably to 1.4%, down from 2.6% in 2022. The fundamental causes are the slowdown in world demand, significantly within the semiconductor sector, a spine of the South Korean financial system.

South Korea is a strongly export-oriented financial system: among the many key sectors, electronics and know-how. Samsung, the world’s largest semiconductor and smartphone producer, represents the image of South Korean industrial success, as does LG, which performs a vital function within the fields of shopper electronics and family home equipment. Both firms are leaders in analysis and growth, driving world innovation in superior fields corresponding to synthetic intelligence and OLED screens. The automotive business can be a pillar of the South Korean financial system, with manufacturers corresponding to Hyundai and Kia standing out for his or her world competitiveness and management within the growth of electrical and hydrogen autos. On the commercial supplies entrance, the nation excels in metal manufacturing, due to giants corresponding to POSCO, and within the chemical business, offering superior supplies for a number of functions.

Innovation is the beating coronary heart of the South Korean financial system. Spending on analysis and growth is shut to five% of GDP, one of many highest percentages on the planet, and locations the nation on the high of the worldwide rankings for technological competitiveness and variety of patents.

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Italy has a privileged financial relationship with South Korea. In 2023, in line with ISTAT information, commerce between the 2 international locations exceeded 10 billion euros. Italy primarily exports industrial equipment and tools, luxurious items corresponding to trend and jewelry, and high-end meals merchandise. South Korea, nonetheless, is a vital associate for the import of semiconductors and technological elements, vehicles and chemical supplies and metal, important for the Italian manufacturing business. The commerce relationship has been strengthened by the free commerce settlement between the European Union and South Korea, operational since 2011, which has eradicated many tariff boundaries and inspired the alternate of products and providers.

The coup in South Korea raises important considerations about the way forward for financial and commerce relations. An interruption within the manufacturing or export of semiconductors would danger compromising world provide chains, with direct repercussions on the Italian electronics and automotive industries.