AJU PRESS ASIA FIRST NEWS AGENCY

Journalist

Kim Yeon-jae
Kim Yeon-jae김연재
ReporterBank of Korea & Market, Macroeconomics
Kim Yeon-jae is a journalist at AJU Press (AJP's English platform),
covering macroeconomics, international finance, and geopolitics.
He closely tracks central bank monetary policies, global energy supply chains,
and the Korean defense industry. "Peering into the risks behind the euphoria."
Latest by Kim Yeon-jae
  • South Koreas round of 32 hopes dashed at World Cup
    South Korea's round of 32 hopes dashed at World Cup SEOUL, June 28 (AJP) - South Korea's hopes of reaching the round of 32 at this year's World Cup were shattered after DR Congo secured a 3–1 win over Uzbekistan, eliminating the country's last remaining slim chance of advancing to the next round. South Korea, which finished third in its group after losing to South Africa in its final group-stage match in Monterrey in northeastern Mexico last week, had been relying on luck, waiting for results of matches from other groups to advance, determined by points earned and goal difference. Even a draw against South Africa would have allowed South Korea to advance, but the defeat left it with only a narrow chance of continuing its World Cup run as one of the eight best third-placed finishers. With several possible scenarios still offering South Korea a chance, many fans had been waiting for results, only to see their hopes fade over the past few days. Ecuador's 2–1 win over Germany and Paraguay's 0–0 draw with Australia lifted both sides above South Korea, followed by Senegal's 5–0 rout of Iraq, which saw the African side move above South Korea on goal difference despite both teams finishing on three points. Iran added another blow by drawing 1-1 with Egypt, ending the group stage on three points and a goal difference of zero, enough to rank ahead of South Korea. South Korea was still clinging to its final chances after those results, but Croatia's 2–1 win over Ghana pushed it deeper into danger. Croatia's victory lifted it into second place, while Ghana slipped to third on four points, still comfortably ahead of South Korea in the third-placed team rankings. The final blow came from Group K. Uzbekistan took the lead against DR Congo, briefly keeping South Korea's hopes alive. But DR Congo responded with three unanswered goals and moved to the brink of a 3-1 win that would take them to four points. If the scoreline holds, DR Congo will become the eighth third-placed team to finish ahead of South Korea, pushing the country out of the knockout stage regardless of the remaining Group J results. South Korea would fall behind Sweden, Ecuador, Ghana, Bosnia and Herzegovina, Paraguay, DR Congo, Senegal and Iran among the third-placed teams. For head coach Hong Myung-bo, the exit marks another painful World Cup failure. He previously led Korea at the 2014 World Cup in Brazil, where the country also failed to survive the group stage. This time, the disappointment may cut deeper, given that it was grouped with the Czech Republic, also known as Czechia, Mexico, and South Africa, widely seen as manageable. South Korea opened the tournament with a 2-1 win over Czechia, raising hopes of a smoother journey to the knockout stage. But a 1–0 defeat to Mexico meant it needed a result against South Africa, and it failed to deliver when a berth was still in its own hands. But South Korea struggled to create clear chances against the African side, lacked urgency in possession, and failed to turn long spells of pressure into meaningful attacks. Hong's tactics also drew sharp criticism. Needing only a draw, South Korea showed little flexibility in formation or tempo and failed to adapt after South Africa cut off passing through the middle, leaving them stuck in a plan they were reluctant to change. With a good start after winning its opener, South Korea went on to lose its two key matches and eventually saw its final hopes fade away. 2026-06-28 11:28:41
  • Seoul to freeze utility charges and lower pump price cap
    Seoul to freeze utility charges and lower pump price cap SEOUL, June 26 (AJP) -South Korea will freeze public utility rates in the second half and lower the ceiling on gasoline prices to help restore energy costs to pre-war levels and contain inflation under 3 percent, while rolling out 1 trillion won ($647 million) worth of fresh food discounts and aid for the self-employed to ese their burden from high prices, the government said Friday. The measures mark the first phase of the government's gradual rollback of emergency economic responses introduced during the Middle East conflict, as easing oil prices allow policymakers to shift their focus from crisis management to stabilizing household finances. Deputy Prime Minister and Finance Minister Koo Yun-cheol announced the package while chairing an emergency economic headquarters meeting, a ministerial economic policy meeting and a special task force on consumer prices at the Government Complex Seoul. "The external uncertainty has gradually eased since the memorandum of understanding ending the Middle East conflict," Koo said, noting that international crude prices have fallen and the average retail diesel price in South Korea has dropped below 2,000 won per liter for the first time in two months. He cautioned, however, that uncertainty surrounding follow-up negotiations remains, while households continue to grapple with high inflation, elevated exchange rates, high interest rates and slowing employment. "The government will devote all available efforts to stabilizing and restoring the people's livelihoods while preparing in earnest for post-war economic normalization and a new leap forward," Koo said. "We will closely monitor developments in the Middle East and the domestic economy while gradually adjusting the emergency response measures currently in place." Korea's producer prices spiked 8.5 percent from a year-ago period in May, the fastest annual increase since the pandemic peak in 2022, while annual inflation rose 3.1 percent on year in May. The Bank of Korea has forecast inflation would stay around 3 percent for "a considerable period." The government said the seventh oil price ceiling, scheduled to be announced later Friday, will be set lower than the current level to reflect the decline in international crude prices. The ceiling will remain in place until retail fuel prices stabilize. To ease food inflation, the government will launch its largest-ever discount campaign on agricultural, livestock and fisheries products during July and August. Fresh egg imports will be expanded more than sixfold, with an additional 200 million eggs to be imported to stabilize prices. The government will also dispatch a special delegation to Norway next month to directly import 2,000 tons of Norwegian mackerel for low-price sales, while purchasing domestically produced fish originally intended for export and supplying them to consumers at half price. To ease energy costs, electricity and natural gas tariffs will remain frozen through the second half of the year, while the levy on LPG butane sales will be temporarily waived through year-end. Households receiving energy vouchers for kerosene or LPG heating will receive an additional 147,000 won, which can be used between October 2026 and May 2027, on top of their existing benefits. The package also expands support for vulnerable groups and small businesses. Toll discounts on expressways will be extended to more people with disabilities and national merit recipients, while the government's lending program for small businesses hit by high fuel prices will double to 3 trillion won from 1.5 trillion won. Additional cashback incentives will also be offered to certified low-price retailers. Separately, the government adopted a Basic Plan for Employment Stability in Industrial Transition to prepare for labor market disruptions stemming from artificial intelligence and the green transition. The plan calls for an early warning system to monitor employment changes by industry and region, while areas facing severe disruption, including coal-fired power plant closures, will be designated as "Just Transition Special Zones" eligible for enhanced government support. The government will also expand vocational training in AI and green technologies for both incumbent workers and job seekers. As part of the initiative, it plans to train 1,000 AI specialists in the second half of this year through intensive advanced technology programs linked to employment and startup opportunities. Koo said the government would soon unveil additional measures to support small and medium-sized enterprises affected by the strong won-dollar exchange rate, while continuing structural reforms to help the economy adapt to the accelerating AI and green transformation. 2026-06-26 09:14:55
  • US assets make up nearly half of Koreas external financial holdings
    US assets make up nearly half of Korea's external financial holdings SEOUL, June 25 (AJP) - South Korea's financial exposure to the United States topped $1 trillion for the first time last year as Wall Street's rally deepened the country's tilt toward Uncle Sam assets. The Bank of Korea said Thursday that Korea’s external financial assets, excluding reserve assets, rose by $344.8 billion from a year earlier to $2.44 trillion at the end of 2025. The United States accounted for $1.15 trillion, or 47.1 percent of the total, the largest share by region. The European Union followed with $307.5 billion, while Southeast Asia stood at $279.5 billion. Korea’s holdings of U.S. assets increased by $204.2 billion from the previous year, driven by residents’ overseas securities investment and gains in global stock markets. Moon Sang-yoon, head of the BOK’s international investment statistics team, said Korea’s U.S. financial assets have grown steadily since the mid-2010s, especially since 2018 and 2019, led by stock investment. “The relatively faster rise in U.S. stock prices compared with other countries also had a significant impact,” Moon said. U.S. assets dominated Korea’s overseas portfolio investment. Korean residents held $802.8 billion in U.S. portfolio assets at the end of 2025, accounting for 64.1 percent of total overseas portfolio investment. Direct investment was also largest in the United States at $250.1 billion, followed by Southeast Asia at $174.7 billion. The currency breakdown showed an even stronger dollar bias. Dollar-denominated external financial assets stood at $1.5136 trillion, or 62.0 percent of the total. Euro-denominated assets came next at $223.1 billion, followed by yuan-denominated assets at $115.3 billion. Dollar assets increased by $224.9 billion from a year earlier, accounting for nearly two-thirds of the total increase in Korea’s external financial assets. The dollar was the largest currency across all major investment categories, making up 38.6 percent of direct investment, 74.1 percent of portfolio investment and 74.6 percent of other investment, including deposits, loans and trade credit. Korea’s external financial liabilities also rose sharply. Foreign investors’ claims on Korean assets increased by $558.0 billion to $1.98 trillion at the end of 2025. The BOK attributed the broad increase to the sharp rise in Korean stock prices, which lifted the market value of foreign-held Korean assets. The KOSPI jumped 75.6 percent in 2025, reversing a 9.6 percent decline in 2024. By region, the United States was the largest holder of Korean external liabilities at $523.1 billion, or 26.4 percent of the total. Southeast Asia followed with $391.4 billion, and the EU with $331.6 billion. By currency, won-denominated liabilities accounted for the bulk of Korea’s external financial liabilities, reaching $1.4 trillion, or 70.7 percent of the total. Won-denominated liabilities increased by $522.4 billion from a year earlier, largely reflecting the rise in the value of Korean stocks held by foreign investors. Moon said the international investment position is a stock-based statistic, meaning it reflects not only actual investment flows but also valuation gains from asset price changes. “Even if foreign investors were net sellers of Korean stocks, the sharp rise in stock prices increased the value of the shares they held, raising the stock of external financial liabilities,” he said. The data also carry implications for the currency market. The won strengthened 2.4 percent against the dollar on a year-end basis in 2025, meaning the latest data should not be read as a direct explanation of the year-end exchange rate. But a larger stock of overseas securities and dollar-denominated assets can create steady demand for foreign currency even when Korea runs current account surpluses and maintains ample foreign exchange reserves. The larger stock of won-denominated liabilities held by foreign investors could also make the currency more sensitive to market swings, as profit-taking or portfolio rebalancing can lead to demand to convert won proceeds into dollars. Moon said the increase in overseas investment by Korean residents should not be viewed negatively in itself because it expands the country’s external financial assets, while foreign capital outflows can add upward pressure to the exchange rate when investors sell Korean assets and convert the proceeds into foreign currency. The figures show that Korea’s currency movements are becoming harder to explain through trade balances or foreign exchange reserves alone, as overseas investment demand, foreign equity flows and asset-price shifts play a larger role in the financial account. 2026-06-25 15:35:50
  • World Cup 26: Korea misses automatic berth, awaits third-place verdict
    World Cup 26: Korea misses automatic berth, awaits third-place verdict SEOUL, June 25 (AJP) - South Korea failed to secure automatic qualification for the Round of 32 after losing 1-0 to South Africa, leaving their World Cup fate to the ranking of third-placed teams. South Korea were beaten at Monterrey Stadium in Mexico on Thursday morning in Korea in their final Group A match of the 2026 FIFA World Cup. In the other Group A match played at the same time, Mexico defeated Czechia 3-0. Mexico finished top of the group with three wins from three matches, while South Africa moved into second place with four points. South Korea ended third with one win and two losses, three points and a minus-one goal difference. Czechia finished bottom with one point. South Korea needed only a draw to secure second place, but they struggled against South Africa’s high press and quick wide attacks. Korea had early openings through Lee Kang-in and Kim Min-jae, but South Africa gradually took control by cutting off Lee’s left-footed passing lanes and forcing mistakes from Hwang In-beom and Paik Seung-ho in midfield. Head coach Hong Myung-bo tried to change the game at halftime by sending on Son Heung-min and Jens Castrop, but Korea still failed to break through South Africa’s pressure. Oh Hyeon-gyu produced Korea’s first shot on target with a header in the second half, but it went straight at the goalkeeper. South Africa then broke the deadlock midway through the second half. Thapelo Maseko received the ball inside the box and drove a shot through Castrop’s legs into the right side of the net. Korea used all five substitutions, bringing on Park Jin-seop, Kim Jin-gyu and Cho Gue-sung in search of an equalizer, but they never found one. In stoppage time, Park met a lobbed pass from Castrop with a back header, only for the ball to go straight to the goalkeeper. The expanded 48-team format appeared to give Korea a wider path out of the group stage, but they are once again left calculating scenarios. Under the new format, the top two teams from each of the 12 groups advance directly to the Round of 32, along with the eight best third-placed teams. South Korea finished with three points, a minus-one goal difference and two goals scored. For now, Korea remain inside the provisional cut line, but their position is far from secure. Among third-placed teams whose groups have already been completed, Scotland are below Korea with three points and a minus-three goal difference. Bosnia and Herzegovina, however, are already ahead with four points. Croatia are also ahead of Korea for now. They have three points and the same minus-one goal difference, but have scored three goals to Korea’s two. That means Korea need at least three more third-placed teams to finish with a worse record than theirs to reach the knockout stage. On the other hand, if six more third-placed teams finish above Korea, Hong’s side would fall to ninth or lower in the third-place ranking and be eliminated. Korea need as many third-placed teams as possible to stay below four points. Every third-place team that reaches four points will move ahead of Korea. Even three-point teams could be dangerous if they match Korea on goal difference and finish with more goals scored. Korea are already ahead of Scotland, but several groups from D to L still have final matches left. Depending on those results, Korea could either claim one of the final knockout spots or exit the tournament as a third-placed team. Even if Korea survive through the third-place ranking, their already-tough path has become much tougher. Canada, who had been their likely opponent had Korea finished second in Group A, are now set to face South Africa, while Korea are more likely to meet the winner of Group E or Group G depending on the final third-place allocation. Germany are the favorite to finish top of Group E, while Group G remains open among Egypt, Belgium and Iran. If Iran beat Egypt and Belgium defeat New Zealand, the group lead could come down to goal difference between Iran and Belgium. The defeat also extended Korea’s winless World Cup run against African teams since 2006. Hong, who was in charge when Korea lost 4-2 to Algeria at the 2014 World Cup, had a chance to change that narrative against South Africa. Instead, Korea were left with another damaging defeat and no control over their own fate. South Korea can no longer change the equation themselves. Their Round of 32 hopes now depend entirely on the numbers produced by the remaining group-stage matches. 2026-06-25 13:46:26
  • Korea loses to South Africa, left waiting on third-place ranking
    Korea loses to South Africa, left waiting on third-place ranking SEOUL, June 25 (AJP) - South Korea failed to secure automatic qualification for the Round of 32 after losing 1-0 to South Africa in their final Group A match at the 2026 FIFA World Cup on Thursday in Korea. South Korea lost at Monterrey Stadium in Mexico after conceding midway through the second half. In the other Group A match played at the same time, Mexico beat Czechia 3-0. The results sent Mexico through as Group A winners and South Africa as runners-up. South Korea finished third with three points and a goal difference of minus one. South Korea are currently around fourth in the ranking of third-placed teams, keeping their knockout hopes alive for now. But their place in the Round of 32 is not yet confirmed, with several groups still to complete their final matches. Hong Myung-bo’s side tried to change the game by bringing on Son Heung-min and Jens Castrop at halftime, but they again struggled to break South Africa’s pressure and conceded after being exposed down the flank. The defeat also extended South Korea’s winless World Cup run against African teams since 2006. Hong, who was in charge when Korea lost 4-2 to Algeria in 2014, missed a chance to erase part of that memory and must now wait to see whether his team can survive through the third-placed team ranking. 2026-06-25 12:05:52
  • World Cup 26: Korea held by South Africa after disjointed first half
    World Cup 26: Korea held by South Africa after disjointed first half SEOUL, June 25 (AJP) - South Korea went into halftime scoreless against South Africa on Thursday after a disjointed first half in which they struggled to beat pressure, move the ball through midfield and turn possession into meaningful chances. South Korea kicked off their final Group A match at Monterrey Stadium in Mexico knowing a draw would be enough to secure second place and a spot in the Round of 32. Opta’s pre-match model had given South Korea a 59.2 percent chance of winning, more than three times South Africa’s 17 percent. The first half, however, played out nothing like those numbers suggested. Korea started brightly, using Hwang Hee-chan and Lee Tae-seok to attack down the flanks. An early corner led to a Kim Min-jae header, but South Africa blocked it near goal. Lee Kang-in then came close in the seventh minute, meeting a cross from the left and sending his shot narrowly wide of the right post. But South Africa soon settled into the match and began to expose Korea’s weaknesses. They pressed high, closed off Lee Kang-in’s passing lanes and repeatedly forced mistakes from Korea’s midfield. Hwang In-beom and Paik Seung-ho also struggled under pressure, giving South Africa chances to break quickly. South Africa looked especially dangerous when attacking the space behind Korea’s right side, where Lee Gi-hyuk was repeatedly tested by pace and long balls. Around the 14th minute, South Africa looked for tall striker Evidence Makgopa with a cross into the box, but Lee challenged him well enough to prevent a clean header. Korea had several warnings after that. In the 18th minute, South Africa broke forward at speed, only for Lee to block the danger with his body. A minute later, South Africa recycled a corner into a long-range shot that went straight to goalkeeper Kim Seung-gyu. Another second-ball chance came around the 29th minute, again forcing Kim into a save. Korea escaped, but the sequence showed how fragile their defensive balance had become. At the other end, Korea’s attacks became predictable. Lee Tae-seok continued to overlap on the left, but his crosses lacked accuracy and repeatedly ended in goal kicks or clearances. Hwang Hee-chan’s long-range effort in the 34th minute also flew well wide. South Africa, meanwhile, appeared well prepared for Lee Kang-in’s left foot. His passes were cut out several times, and Korea failed to find a reliable route into the final third. The half ended 0-0 after South Africa’s final corner in stoppage time came to nothing. South Korea are still on course to advance if the score holds, but the first half left Hong Myung-bo’s side needing a sharper response after a performance that was far below expectations. 2026-06-25 10:59:34
  • World Cup 26: Korea holds its breath as Round of 32 hangs in balance
    World Cup 26: Korea holds its breath as Round of 32 hangs in balance SEOUL, June 25 (AJP) - Thousands of football fans packed central Seoul's Gwanghwamun from early Thursday morning, filling public viewing areas and gathering around giant screens hours before South Korea's decisive 10 a.m. (Korea time) World Cup kickoff, while millions more across the country glued themselves to televisions and smartphones for the make-or-break clash with South Africa. The entire nation would come to a standstill for 90 minutes as South Korea faced South Africa at Monterrey Stadium in Mexico in their final Group A match, needing only a draw to secure a place in the Round of 32. South Africa has even higher stakes, needing nothing less than victory to keep its knockout hopes alive. Hong Myung-bo is expected to retain the core of Son Heung-min, Lee Kang-in, Hwang In-beom and Kim Min-jae, although changes in attack and at wing-back remained possible after Korea's blunt display in the 1-0 defeat to Mexico. South Africa, by contrast, is dealing with midfield absences after Teboho Mokoena and Siphephelo Sithole were ruled out through suspension, forcing them to reorganize the center of the pitch. For Hong, the match also carries personal significance. His first World Cup campaign as Korea coach ended painfully in Brazil in 2014 with a 4-2 defeat to Algeria, and South Korea have beaten African opposition only once at the World Cup — against Togo in 2006 — while drawing with Nigeria and losing to Algeria and Ghana. Mexico also exposed a tactical weakness that South Africa was expected to target. By shutting down Lee Kang-in and Hwang In-beom in midfield and denying service to Son Heung-min, Mexico disrupted Korea's buildup and reduced Hong's side to just one shot on target. South Africa were expected to defend deeper rather than press aggressively, meaning Korea would have to show far greater creativity against a compact defense. The qualification equation nevertheless remains in South Korea's favor. A draw would guarantee second place in Group A regardless of the outcome between Mexico and Czechia because Korea held the head-to-head advantage over the Europeans. Victory would send Hong's side into the Round of 32 with renewed momentum after the setback against the hosts. Defeat is the only scenario that brings real danger. If South Africa pulls off the upset, Korea's fate would hinge on the Mexico-Czechia result and the standings among the tournament's best third-placed teams, turning what was within Hong's side's control into an anxious wait — with the fingers of more than 50 million people back home firmly crossed. 2026-06-25 09:26:28
  • Koreas business sentiment dips, divide deepens on narrow chip-led growth
    Korea's business sentiment dips, divide deepens on narrow chip-led growth SEOUL, June 25 (AJP) - South Korea's business sentiment deteriorated by the steepest clip in 15 months while factory confidence climbed to its highest level in nearly four years, further underscoring the widening divide in the economy whose vitality is concentrated on chipmaking floors, central bank data showed Thursday. According to the Bank of Korea, the Composite Business Sentiment Index (CBSI) for all industries fell 1.2 points from a month earlier to 97.7 in June. The decline marked the sharpest monthly fall since January 2025, when the index dropped 1.4 points. The reading remained below the benchmark level of 100, indicating corporate sentiment was still weaker than its long-term average. The setback came after a sharp rebound in May, when strong exports, a record-setting stock market and easing expectations over oil and currency shocks lifted business confidence close to the neutral threshold. The latest data suggest the recovery has become more uneven rather than fully reversed, with exporters and large manufacturers continuing to benefit from resilient external demand while domestic-facing and service-sector businesses lose momentum. Manufacturing CBSI rose to 101.2 in June from 100.8 in May, remaining above the benchmark for a second straight month. It was the highest level since August 2022, when the index stood at 102.9. The BOK said the improvement was driven mainly by funding conditions, which contributed 0.4 point, and new orders, which added 0.2 point. Underlying manufacturing indicators pointed to a widening gap between export and domestic demand. The export BSI rose to 96 from 94, while new orders increased to 88 from 87. Domestic sales, however, fell to 85 from 88, and overall sales slipped to 91 from 93. Export-oriented manufacturers continued to outperform companies reliant on the domestic market. Exporters' CBSI rose to 106.4 from 105.3, while the reading for domestically focused firms edged down to 98.0 from 98.4. The divide was equally evident by company size. Large manufacturers saw their CBSI rise to 104.5 from 103.4. Small and medium-sized enterprises, however, slipped to 95.7 from 96.2, underscoring that the manufacturing recovery remains concentrated among larger exporters. Non-manufacturing sentiment moved in the opposite direction. The non-manufacturing CBSI fell to 95.4 from 97.5 as weaker sales and profitability, compounded by higher energy-related costs and sluggish consumption, dragged down the index. Sales and profitability each shaved 0.9 point off the non-manufacturing reading. Lee Heung-hoo, head of the BOK's economic sentiment survey team, said manufacturing improved on robust semiconductor-led IT exports, while non-manufacturing weakened mainly because of sluggish construction activity and a payback from stronger holiday-related demand in arts, sports and leisure businesses in May. The divergence suggests last month's broader rebound has yet to translate into a sustained recovery in domestic demand. Corporate concerns also shifted in June. Rising raw material prices remained manufacturers' biggest challenge, cited by 27.7 percent of respondents. But the share fell from 32.8 percent in May, suggesting some easing in commodity- and energy-related cost pressures. Exchange-rate volatility, meanwhile, became a more visible burden. The share of manufacturers citing currency movements as a management concern rose to 7.8 percent from 5.0 percent, while the corresponding share among non-manufacturers increased to 5.7 percent from 3.7 percent. The shift marked a contrast with May, when businesses appeared to be moving beyond concerns over oil prices, exchange rates and geopolitical uncertainty. In June, currency worries resurfaced even as raw material price pressures eased. Companies also turned more cautious about the near-term outlook. The July all-industry CBSI outlook fell to 95.2 from 97.6. The manufacturing outlook dropped to 98.2 from 100.3, while the non-manufacturing outlook declined to 93.2 from 95.9. The Economic Sentiment Index (ESI), which combines business and consumer sentiment, fell to 96.8 in June from 97.5 in May. Its cyclical component was unchanged at 95.1, suggesting the broader economy has yet to reach a clear turning point despite the resilience of semiconductor-driven exports. The June survey was conducted from June 10 to 17 among 3,184 companies, including 1,780 manufacturers and 1,404 non-manufacturers. 2026-06-25 07:20:03
  • Koreas migration to developed status rejected and the won is why
    Korea's migration to developed status rejected and the won is why SEOUL, June 24 (AJP) - The stock market rebounded, but the Korean won slipped deeper toward crisis-era lows after South Korea once again failed to make MSCI's developed-market watchlist, a sober reminder that the currency - not the equities - is the stumbling block to an upgrade. The KOSPI has quadrupled over the past 18 months to become one of the world's best-performing equity markets since 2025, but its rally alone was not enough. For years, Seoul has tried to secure MSCI developed-market status by improving market accessibility through English-language disclosures, settlement systems and extended foreign-exchange trading hours. Fellow index provider FTSE Russell has classified South Korea as a developed market since 2009, but MSCI remains unconvinced. In its annual review Tuesday, MSCI acknowledged the progress but pointed to a familiar obstacle. "The Korean won is not deliverable offshore. Even more concerning, onshore liquidity during the extended FX trading hours remains largely insufficient to support tight execution at standards comparable to those observed in developed markets." The message was straightforward: global investors still do not believe they can trade the won with the same depth, consistency and predictability available in developed-market currencies. That distinction matters because hopes have grown in Seoul that MSCI inclusion could strengthen both equities and the currency. The won has remained under pressure despite the stock rally, closing at 1,544.70 per dollar on Tuesday, down 2.4 percent from the end of May and more than 7 percent weaker than at the beginning of the year. President Lee Jae Myung frowned at what he called the won's "excessive" weakness relative to Korea's economic fundamentals, while Finance Minister Koo Yun-cheol attributed the move to foreign investors' profit-taking and portfolio rebalancing. Government officials maintained a brave face Wednesday, saying MSCI recognizes Korea's reform efforts and that continued progress should eventually lead to an upgrade. But MSCI's concerns are structural rather than cyclical. Foreign investors must convert money into won to buy Korean stocks and convert it back when they sell. Yet the currency remains unavailable in a fully deliverable offshore market, while liquidity during extended trading hours has yet to prove itself. MSCI also cited the limited use of omnibus accounts and in-kind transfers, as well as operational burdens surrounding short selling and settlement procedures. The issue, in other words, is not whether foreign money can enter Korea. It is whether investors can trade Korean assets, hedge currency risk and move capital without unusual friction. That is also why MSCI inclusion should not be viewed as a straightforward remedy for won weakness. If Korea joins the developed-market index, it would simultaneously leave the emerging-market benchmark. Funds tracking emerging-market indexes would have to sell Korean stocks, while developed-market funds would buy them. The net effect may be far smaller than many assume. Korea carries a relatively large weighting in emerging markets. In developed-market benchmarks, however, it would become a much smaller component alongside the United States, Japan and major European economies. Some estimates suggest net inflows could amount to around $4 billion after offsetting the two streams, while others point to temporary net outflows depending on the timing and mechanics of rebalancing. That makes MSCI inclusion a poor candidate for a short-term defense against currency weakness. The Bank of Korea echoed that view Wednesday. Deputy Governor Jang Jeong-su said recent won weakness reflects foreign stock selling, profit-taking and portfolio adjustments rather than a deterioration in economic fundamentals. He added that the exchange rate should stabilize gradually if foreign selling subsides, supported by Korea's current-account surplus and solid external balances. An upgrade could still produce meaningful long-term benefits. It would help reduce the Korea discount and strengthen the country's standing among global investors. But that would be the result of a more open and predictable market structure, not a policy tool capable of stabilizing the exchange rate on its own. The debate over whether the won must become something close to a reserve currency also risks missing the point. A Bank of Korea official, speaking on condition of anonymity, said MSCI is not asking Korea to turn the won into another dollar, euro or yen. "The issue is whether global institutional investors can convert, hedge and settle the won without being constrained by time zones or trading restrictions," the official said. That may be the clearest takeaway from this week's decision. MSCI is not questioning Korea's economic strength. It is questioning whether Korea's currency and market infrastructure are open enough for global investors to operate seamlessly. Korea may eventually secure a developed-market upgrade if reforms continue. But this week's setback shows that such a milestone would be the outcome of structural reforms, not a shortcut to a stronger won. 2026-06-24 17:32:06
  • World Cup 26: Ronaldo returns as Colombia advance, England held by Ghana
    World Cup 26: Ronaldo returns as Colombia advance, England held by Ghana SEOUL, June 24 (AJP) - Cristiano Ronaldo scored twice to revive Portugal’s World Cup campaign, Colombia secured a place in the knockout stage and England were held by Ghana as Groups K and L moved closer to their final-round showdowns on Tuesday local time. Croatia also beat Panama 1-0 to stay alive in Group L, eliminating the Central American side after two straight defeats. Portugal produced the statement performance of the day, beating Uzbekistan 5-0 in a Group K match in Houston. Ronaldo, who had been quiet in Portugal’s opening 1-1 draw with DR Congo, struck in the sixth and 39th minutes to put Portugal in control before halftime. The goals made him the first player to score in six different World Cups. His opener against Uzbekistan was also his first World Cup goal from open play since his header against Morocco in 2018. Nuno Mendes scored Portugal’s second goal with a free kick in the 17th minute, before Uzbekistan goalkeeper Abduvohid Nematov conceded an own goal in the second half. Rafael Leao completed the scoring late in the match. The victory lifted Portugal to four points and put them on the verge of the knockout stage after their flat start against DR Congo, though they still need at least a draw against Colombia to remove any uncertainty over a top-two finish. Uzbekistan, playing in their first World Cup, stayed on zero points after two defeats. They are not mathematically eliminated, but their heavy goal-difference deficit leaves them with only a slim third-place route. In Group L, England failed to turn possession into goals in a 0-0 draw with Ghana in Boston. England did not register a shot on target in the first half as Ghana sat deep, defended in two compact lines and made clear that a point would suit their plan. The game opened up after halftime, and England created several chances, but Ghana’s defensive structure held. England’s clearest opening came when the ball came back off the woodwork and fell to Harry Kane, but the captain lifted his rebound over the bar from close range. Ghana, who had beaten Panama with a late winner in their opening match, achieved exactly what they needed. The draw moved them to four points and put them in a strong position in the race for the Round of 32. England also moved to four points but missed the chance to secure early qualification after opening the tournament with a 4-2 win over Croatia. Croatia then kept their own hopes alive with a tense 1-0 win over Panama in Toronto, giving Luka Modric a victory in his 200th international appearance. Panama, who qualified as the top team from CONCACAF excluding the three co-hosts, showed their strength in the first half and hit the post as they tried to take their first points of the tournament. But Croatia broke through in the second half when Ante Budimir finished from the right side after a cross and attacking move involving Marco Pasalic and Josip Stanisic. Panama responded with pace on both wings and continued to threaten after falling behind, but they could not find an equalizer. The defeat eliminated Panama and locked them into bottom place in Group L, while Croatia moved to three points and kept pressure on England and Ghana before the final round. The last match of the day saw Colombia beat DR Congo 1-0 in Group K at Guadalajara Stadium. Colombia controlled much of the match but had to work hard for the breakthrough, with two goals ruled out for offside or a foul. The decisive moment came in the second half when Daniel Munoz scored from the right side of the penalty area, his shot taking a deflection before finding the net. DR Congo, who had earned a 1-1 draw against Portugal in their opening match, nearly rescued a point in stoppage time, but their late shot was kept out by Colombia’s goalkeeper. The win moved Colombia to six points from two matches and secured their place in the knockout stage. Colombia and Portugal will meet in the final round with top spot in Group K at stake. Colombia have already qualified, while Portugal can secure a top-two finish with at least a draw. DR Congo need to beat Uzbekistan to keep a realistic knockout route alive, while Uzbekistan must win and hope to survive through the third-placed team ranking. In Group L, England and Ghana remain on four points, with Croatia on three and Panama eliminated. England need at least a draw against Panama to guarantee a top-two finish, while Ghana can do the same against Croatia. Croatia must beat Ghana to move into the top two, though a draw or defeat could still leave them waiting on the third-placed team ranking. 2026-06-24 15:09:45