South Korea braces for Trump’s insurance policies with biggest-ever export finance help

SEOUL (Reuters) – South Korea pledged on Monday a report quantity of financing help for exporters to mitigate any unfavorable influence from adjustments in U.S. commerce insurance policies as Donald Trump was poised to be sworn in for his second presidency.

The federal government plans to supply 360 trillion received ($247.74 billion) value of coverage financing to exporting corporations via state-run banks and establishments this 12 months, in keeping with a press release launched by the finance ministry.

“There are considerations that exterior uncertainty can be heightened below the incoming U.S. administration and adversely have an effect on exports,” the ministry mentioned.

The ministry mentioned it will additionally increase insurance coverage help to protect towards international change volatility to 1.4 trillion received this 12 months, from 1.2 trillion received final 12 months, and spending on authorities initiatives, similar to commerce festivals and delegations, to 2.9 trillion received from 2.1 trillion received.

Sectors notably below menace of latest U.S. insurance policies are semiconductors and rechargeable batteries, the ministry mentioned, whereas defence, nuclear power and shipbuilding sectors are seen as extra promising due to room for cooperation with the USA.

U.S. President-elect Trump, who takes workplace afterward Monday, has pledged to impose stiff tariffs on main buying and selling companions, similar to Mexico, Canada and China, that are additionally anticipated to have an effect on South Korean corporations working factories in these international locations.

Economists say there are worries that the Trump administration will introduce commerce insurance policies towards South Korea too, after Asia’s fourth-largest financial system earned a record-high surplus of $55.7 billion in commerce with the U.S. in 2024, up 25.4% from 2023.

The Korea Worldwide Commerce Affiliation, South Korea’s largest group of exporting corporations, initiatives export progress to sluggish to 1.8% this 12 months. Final 12 months, South Korea’s exports rose 8.1% to a report excessive of $683.7 billion, as gross sales to the U.S. rose 10.4%.

($1 = 1,453.1500 received)