Won-based digital currency becomes hot topic in presidential race SEOUL, May 20 (AJP) - Stablecoins have become an unexpected battleground in South Korea’s presidential election, as major candidates debate the merits and risks of introducing a won-based digital currency. While proponents frame the move as a way to bolster national financial sovereignty, critics warn of regulatory gaps and potential misuse. The opposition Democratic Party (DP), led by presidential contender Lee Jae-myung, has proposed the issuance of a stablecoin backed by the South Korean won. The party argues that such a step would counterbalance the increasing dominance of the U.S. dollar in global digital asset markets and advance South Korea’s position in the fast-evolving financial technology landscape. Stablecoins — digital assets pegged to traditional fiat currencies like the dollar or euro — have drawn attention worldwide for their promise of faster, cheaper transactions. Their growing use as payment methods, however, has also raised red flags among regulators due to the risk of illicit activity and insufficient oversight. During a nationally televised debate on May 18, Reform Party candidate Lee Jun-seok pressed Lee Jae-myung for details on the Democratic Party’s proposal. “I’m curious about what mechanisms the DP will establish to prevent the illegal circulation of won-based stablecoins,” Lee Jun-seok said. “How much will be set aside as reserves?” Lee Jae-myung replied that the proposed system would rely on a “one-to-one reserve system” to ensure stability, but stopped short of addressing concerns over criminal misuse or the framework for financial compliance. Those concerns are not unfounded. According to blockchain analytics firm Chainalysis, stablecoins accounted for roughly 63 percent of all illicit crypto transactions globally in 2024. The Financial Action Task Force has since called for the application of international anti-money laundering standards to digital assets, including stablecoins. Adding to the scrutiny, experts gathered on May 19 for a panel discussion hosted by the Federation of Korean Industries, where they urged lawmakers to proceed with caution. “Korea should expedite second-phase legislation in line with global trends,” said Kim Hyo-bong, an attorney at Bae, Kim & Lee. Kim noted that the United States is advancing its comprehensive digital asset regulation — the so-called GENIUS Act — while the European Union has already enacted its Markets in Crypto-Assets (MiCA) regulation. Lee Seung-seok, a researcher at the Korea Economic Research Institute, warned that premature adoption of stablecoins — particularly those tied to foreign currencies — could have unintended macroeconomic effects. “If dollar-based stablecoins become widely accepted in Korea, they could trigger structural changes in the won-dollar exchange rate,” he said. “This could lead to increased demand for foreign currency and decreased use of the won, potentially causing exchange rates to spike.” 2025-05-20 14:10:12

Lee Jae-myung bets big on artificial intelligence to revive economy Editor’s Note: This is the first in a two-part series examining the economic campaign promises of Democratic Party presidential candidate Lee Jae-myung. SEOUL, May 20 (AJP) - South Korea’s Democratic Party presidential candidate, Lee Jae-myung, is wagering his economic revival plan on a massive national investment in artificial intelligence, vowing to elevate the country into the ranks of the world’s top AI powers with a bold 100 trillion won ($70.6 billion) initiative. “I will position Korea as one of the world’s top three AI powers,” Lee declared in a Facebook post on April 14, framing AI as the centerpiece of his campaign for economic leadership. The former Gyeonggi Province governor unveiled his plan at Pangyo Techno Valley, the nation’s equivalent of Silicon Valley, outlining a vision to transform South Korea into a global economic powerhouse. At the heart of this vision is a commitment to scale the country’s AI capabilities to match or exceed those of leading nations and to increase the government’s AI-related budget to globally competitive levels. “If all citizens use the so-called ‘Korean ChatGPT,’ we can rapidly accumulate vast datasets,” Lee said. “This will lead to productivity innovation, the creation of new industries, and a strengthened national competitiveness.” The pledge comes amid growing concern that South Korea is falling behind in the global AI race. According to Stanford University’s “AI Index Report 2025,” private investment in AI in South Korea fell to $1.33 billion last year from $1.39 billion the year before, dropping its global ranking from ninth to 11th. By comparison, the United States led with $110 billion, followed by China with $9.3 billion. Industry experts have underscored the urgency of building a domestic AI ecosystem. “The utmost priority is not just supporting small and medium-sized enterprises, but fostering a strong internal market,” said Lee Kyung-il, chief executive of Saltlux, an AI company based in Seoul. “We need South Koreans using the best AI technologies and receiving high-quality training to stimulate market competition.” Lee’s “AI for All” initiative, which proposes free access to advanced AI tools for every citizen, reflects his broader “basic society” philosophy. But critics argue that the plan lacks specificity, particularly in defining the AI models to be supported. With existing tools like ChatGPT and Google’s Gemini already offering free versions, analysts question whether his proposal is truly groundbreaking. Still, the campaign’s ambitions are formidable. Lee has promised to acquire more than 50,000 high-performance GPUs and to establish a national AI data integration cluster. He also pledged regulatory exemptions to support emerging AI-driven industries. But experts warn that simply amassing hardware is not enough. “Becoming a global AI leader requires more than processors,” said one professor affiliated with an AI research institute. “We need significant investment in research and development, high-quality datasets, advanced model designs, and the engineering capability to make full use of the hardware.” Beyond technical capacity, energy consumption may present the most immediate obstacle. The NVIDIA A100 Tensor Core GPU, a common workhorse in AI data centers, consumes up to 400 watts. With 50,000 units, consumption could reach 20 megawatts — equivalent to a small or mid-sized thermal power plant. Factoring in infrastructure like cooling systems, power usage could soar to 30 megawatts. Over the course of a month, that translates to 21,600 megawatt-hours — roughly equal to the monthly electricity use of more than 80,000 South Korean households, based on data from the Korea Electric Power Corporation. The International Energy Agency estimates that global electricity demand from data centers will more than double by 2030, reaching 945 terawatt-hours — surpassing the current annual electricity usage of Japan. South Korea’s Ministry of Trade, Industry and Energy projects that domestic AI data centers will require about 8.2 terawatt-hours of electricity by 2025, increasing to 30 TWh by 2038. These projections present a challenge for the Democratic Party, which has historically opposed nuclear energy. Meanwhile, global tech giants including Amazon, Google and Microsoft are moving to adopt small modular reactors to meet surging energy needs. Compounding the difficulty, South Korea’s power grid is already under strain. The high-voltage direct current (HVDC) project intended to transmit electricity from the East Coast to the metropolitan region is now nearly seven years behind schedule due to opposition from local governments. With transmission bottlenecks already limiting power flow from regions to the Seoul capital area, some coal-fired power plants in the Yeongdong region reportedly operated at just 20 to 30 percent capacity last year. To address these constraints, Lee has proposed the construction of a “West Coast Energy Highway” by 2030, intended to deliver 20 gigawatts of offshore wind power from the southwest coast through a subsea transmission grid. A broader plan envisions a U-shaped energy corridor connecting the Honam and Yeongnam regions to eastern offshore wind farms by 2040. But energy experts remain skeptical. “To advance the plan as promised, massive resources must be secured, and we need the technical ability to lay submarine cables across the west coast,” said Yoo Seung-hoon, a professor at Seoul National University of Science and Technology. “There are still no detailed financial or technical plans for implementation and commercialization.” Yoo added that similar pledges by rival candidates also suffer from a lack of specificity, particularly given South Korea’s challenges with community opposition to large-scale infrastructure projects. Even as the government allocates substantial venture capital for AI development, some in academia warn the approach may be misdirected. “Many of our brightest minds still leave the country to work abroad,” said Choi Jae-sik, a professor at the KAIST Graduate School of AI. “We may be lacking the systems necessary to reward their efforts here. Culture matters, and we need solutions that people can relate to.” Despite the hurdles, Lee has continued to cast his vision in existential terms. “An overwhelming and complex crisis looms before us,” he said in a May 12 speech launching his campaign. “To overcome the trade crisis driven by the United States and the fierce global AI competition, the nation must unite. Every citizen must be part of the solution.” 2025-05-20 11:04:52

SK Telecom breach exposes nearly 27 million subscriber records SEOUL, May 19 (AJP) - Nearly all customers of SK Telecom, South Korea’s largest wireless carrier, may have been affected by a major cybersecurity breach that exposed nearly 10 gigabytes of sensitive subscriber identification data, the government said on Monday. A joint investigation by the Ministry of Science and ICT and the Korea Internet & Security Agency (KISA) found that the breach compromised more than 26.95 million subscriber identification numbers — a figure that exceeds the company’s reported 25 million customers. The data breach, which was discovered last month, is believed to have gone undetected for nearly three years. Investigators determined that malicious code was first implanted on June 15, 2022, allowing attackers persistent access to SK Telecom’s internal systems through 23 compromised servers. Officials said 25 types of malware were deployed in the attack, 24 of which exploited the Berkeley Packet Filter — a tool used to monitor network traffic that made the intrusions especially difficult to detect. “The extracted database may include test data or temporary identifiers used by SK Telecom,” said Lee Dong-geun, head of the Korea Internet Security Center at KISA. He added that additional analysis is required to determine how many legitimate customer accounts were affected. Initial findings from April 29 had pointed to five infected servers, but a broader investigation later revealed that 18 more systems had been compromised, significantly expanding the scope of the breach. The revelation has raised national security concerns, with some experts arguing that the scale of the incident warrants government-level intervention beyond corporate responsibility. Despite the scope of the intrusion, investigators said the stolen data could not be used to clone smartphones or gain physical access to mobile networks. However, SK Telecom has been directed to implement additional safeguards for potentially affected users. The National Intelligence Service has launched security audits across central government agencies, local governments, and public institutions in response to the breach. As of Monday, no further intrusions had been detected in either public or private networks. 2025-05-19 16:52:56

South Korea downplays market fallout from US credit downgrade SEOUL, May 19 (AJP) - South Korea’s Ministry of Economy and Finance convened an emergency meeting on Monday to evaluate the potential ripple effects of Moody’s downgrade of the United States’ sovereign credit rating, concluding that the impact on domestic markets would likely remain limited. The meeting, held via conference call and chaired by Vice Finance Minister Yoon In-dae, came two days after Moody’s Investors Service lowered the U.S. long-term issuer rating to Aa1 from Aaa. The outlook was simultaneously revised from negative to stable. Moody’s said the downgrade reflects “the increase over more than a decade in government debt and interest payment ratios to levels that are significantly higher than similarly rated sovereigns.” However, the agency emphasized that the United States “retains exceptional credit strengths such as size, resilience and dynamism and the continued role of the U.S. dollar as the global reserve currency.” South Korean officials characterized the move as a delayed realignment with other major ratings firms. Fitch Ratings cut the U.S. rating in August 2023, and S&P Global Ratings downgraded the country in 2011. In Washington, the White House dismissed the downgrade, attributing it to fiscal mismanagement under the previous administration. “If Moody’s had any credibility, they would not have stayed silent as the fiscal disaster of the past four years unfolded,” said spokesperson Kush Desai. While Seoul’s response was measured, officials acknowledged that the downgrade could exacerbate short-term volatility, especially amid ongoing uncertainties tied to U.S. trade policy. The Ministry of Finance pledged to maintain close oversight of global and domestic markets through its regular meeting on macroeconomic and financial issues, known as F4. 2025-05-19 15:20:23

Korean grape exports soar to record high SEOUL, May 19 (AJP) - South Korea’s grape exports surged to an all-time high in the first quarter of 2025, nearly doubling from the same period a year earlier, according to customs data released Monday. Export volume reached 1,412 metric tons between January and March, an 89.8 percent increase year-over-year, the Korea Customs Service said. Despite a decline in average prices — from 5,389 won per kilogram in March 2024 to 4,978 won this year — the total value of grape exports climbed to $13.83 million, up 45 percent. That marks the fastest growth rate among South Korean fresh food products generating more than $10 million in export revenue. Taiwan was the largest importer, accounting for 42.1 percent of total shipments, or 594 tons. It was followed by Hong Kong (225 tons), the United States (157 tons), Vietnam (146 tons), and Singapore (114 tons). Officials attribute the increase in demand largely to the popularity of Shine Muscats, a premium grape variety prized for its sweetness, durability, and extended shelf life. “The exceptional quality, sweetness, and superior shelf life of our flagship Shine Muscats have driven increasing demand across overseas markets,” said an official from the Ministry of Agriculture, Food and Rural Affairs. Expanded domestic cultivation has also bolstered supply and improved international price competitiveness, further fueling the export boom, the official said. Agricultural experts expect growth to continue, particularly after Australia eased quarantine restrictions in late April on Shine Muscats — a move that opens a key market previously limited to other South Korean grape varieties such as Campbell Early and Geobong. The updated regulations require only standard protocols: registered export districts, fruit bagging, and cold disinfestation treatment — measures already in place for other varieties. 2025-05-19 11:16:34

Forum highlights AI being pushed into daily life SEOUL, May 15 (AJP) - South Korea is rapidly integrating artificial intelligence into everyday life, marking a shift from early-stage development to practical applications, industry leaders said at a technology forum in Seoul on Thursday. At the 3rd Mega AI Forum, held at the Korea Exchange building in Yeouido, Seoul, government officials and corporate executives convened to examine the growing role of software robots and agent AI in society. The event was hosted by Aju Business Daily under the theme, “SW Robots: Breathing Life into Agent AI.” Speakers emphasized that AI is evolving beyond technical innovation, taking on increasingly personal and emotional roles in users' lives. “AI technology development extends beyond mere technical advancement,” said Lim Gyu-jin, chief executive of Aju Business Daily, in his opening remarks. “It has the power to amplify human creativity and productivity while redefining daily routines and societal values.” Among the prominent attendees were former Minister of Science and ICT Lee Jong-ho, Democratic Party lawmaker Shin Jeong-hoon, and Choi Hyung-du of the ruling People Power Party. Second Vice Minister of Science and ICT Kang Do-hyun also delivered remarks, urging all sectors to embrace AI’s transformative potential. “We have entered an era that demands complete transformation,” Kang said. “I hope all sectors will rise to the challenge, with South Korea continuing to lead in the global AI industry.” In a keynote address, Lee Se-young, chief executive of Wrtn Technologies, described agent AI as “all methods and means by which humanity utilizes AI.” He predicted a future where personalized AI assistants will engage in emotional exchanges and support individual decision-making. Executives from Kakao Mobility, SK Telecom, and Krafton presented their latest AI-driven services. Chang Sung-wook, senior vice president at Kakao Mobility, projected a convergence of agent AI with physical AI in areas such as autonomous driving and robotics. Yoon Hyun-sang, vice president of SK Telecom’s AI business division, said that future business models will be driven by AI that adapts to users, rather than requiring users to adapt to the technology. Meanwhile, Sung June-sig, head of Krafton’s applied deep learning department, unveiled generative AI tools currently being deployed in the company’s early-access simulation game inZoi. The forum concluded with a panel discussion titled “Korean Agent AI and Physical AI,” moderated by former Minister Lee. Participants included Seoul National University professor Yoon Sung-roh, KAIST professor Choi Jae-sik, Saltlux CEO Lee Kyung-il, and Wrtn Technologies co-founder Kim Tae-ho. The panelists addressed critical issues such as data privacy in AI training, the transition from virtual to physical AI, and the role of government in fostering innovation. 2025-05-15 17:49:04

Hyundai Motor to build first Middle East factory, eyes Saudi as regional hub SEOUL, May 15 (AJP) - Hyundai Motor has begun construction on its first automobile manufacturing plant in the Middle East, part of a strategic push to establish Saudi Arabia as a central base for regional operations. The facility, named Hyundai Motor Manufacturing Middle East, is being built in King Abdullah City, within the King Salman Automotive Cluster. Groundbreaking took place Wednesday, with the start of production scheduled for the fourth quarter of 2026. The plant is a joint venture between Hyundai Motor, which holds a 30 percent stake, and Saudi Arabia’s powerful Public Investment Fund, which controls the remaining 70 percent. The move signals Hyundai’s ambition to deepen its presence in the region, where vehicle sales are expected to exceed 3 million annually by 2030. Last year, Hyundai sold 840,000 vehicles in Saudi Arabia alone, which represented roughly 34 percent of the Middle Eastern market. “With this factory, we are driving change forward and paving the way for a new industrial future in the region,” said Park Wong-yun, vice president and CEO of the joint venture, in remarks at the ceremony. “The facility will become a platform for growth and industrial excellence in the heart of the kingdom.” The plant will have the capacity to produce 50,000 vehicles per year and will manufacture both internal combustion engine and electric models. Hyundai officials said the initiative aligns with the goals of Saudi Arabia’s Vision 2030 — a sweeping plan to reduce the kingdom’s reliance on fossil fuels and diversify its economy through industrial development and sustainability. As part of that effort, Saudi Arabia aims to produce 500,000 electric vehicles annually by 2030 and convert more than 30 percent of the vehicles in its capital, Riyadh, to electric. The broader Gulf region has also shown momentum in EV adoption. Qatar has set a goal of 10 percent EV usage by 2030, and the United Arab Emirates saw electric vehicle imports rise from $100 million in 2019 to $1.39 billion in 2022, a 14-fold increase. The expansion comes amid renewed diplomatic and commercial engagement between the United States and key Gulf states. U.S. President Donald Trump — on his first overseas trip since returning to office — arrived in the region this week, with stops in Saudi Arabia, Qatar, and the UAE. 2025-05-15 13:44:40

Container ship orders surge, defying global shipping slowdown SEOUL, May 14 (AJP) - Global orders for container ships surged in early 2025, defying broader trends in the maritime industry and signaling a shift driven by environmental regulations and geopolitical trade tensions. As of the first week of May, new container ship orders reached approximately 1.65 million twenty-foot equivalent units (TEUs), nearly equaling the 20-year annual average of 1.71 million TEUs, according to industry data released Wednesday. That figure represents a 285 percent increase from the same period last year. The surge stands in contrast to the rest of the shipbuilding sector. Overall global vessel orders dropped nearly 50 percent year-on-year to 12.59 million compensated gross tons (CGT), a standard measure that adjusts for ship complexity and labor intensity. Analysts and industry observers had expected a slowdown in container ship demand, particularly as new vessels ordered during the pandemic began entering service. Compounding the skepticism were forecasts of weakening global trade amid revived protectionist policies under U.S. President Donald Trump. In January, the Export-Import Bank of Korea projected a 32 percent decline in overall shipbuilding orders for the year, citing diminished demand for both LNG carriers and container ships. But the recent uptick suggests a more complex picture. “Despite massive supply of container vessels already entering the market with more to come, shipowners continue purchasing container ships,” said Han Young-soo, an analyst at Samsung Securities. “This can be explained by replacement demand to comply with environmental regulations.” The International Maritime Organization in April approved new measures to regulate greenhouse gas emissions for ships over 5,000 tons starting in 2027. Penalties for excess emissions will range from $100 to $380 per ton, prompting shipping companies to replace older fleets with more energy-efficient models. Flush with cash from elevated freight rates during last year’s crisis in the Red Sea — disruptions caused by the Israel–Hamas war — container carriers are accelerating the transition to low-emission vessels. The demand has been particularly robust for feeder container ships, smaller vessels typically under 3,000 TEU used on regional routes. South Korea’s HD Hyundai Mipo has secured contracts for 16 of the 33 feeder ships ordered globally this year, making it the market leader in that category. South Korean shipbuilders are also poised to benefit from geopolitical headwinds. The Trump administration has announced a new tariff targeting Chinese-built and Chinese-flagged ships, imposing a $50 per ton levy on vessels docking at U.S. ports starting in October. That figure is set to rise to $140 per ton by 2028. 2025-05-14 15:29:37

Presidential candidates embrace cryptocurrency as major campaign issue SEOUL, May 14 (AJP) - Cryptocurrency has emerged as a central campaign issue, with major presidential candidates pledging sweeping regulatory reforms — including the approval of spot cryptocurrency exchange-traded funds (ETFs) — ahead of the June 3 election. Lee Jae-myung of the liberal Democratic Party and Kim Moon-soo of the conservative People Power Party have each unveiled ambitious digital asset agendas aimed at expanding access to crypto markets and integrating them more closely into the financial mainstream. Their proposals reflect a broader surge in domestic interest in digital assets, as well as international momentum driven by U.S. policy shifts under the Trump administration. “We will help young people build assets,” Lee wrote in a May 6 Facebook post, outlining plans to legalize spot crypto ETFs and introduce an integrated oversight system for the digital asset market. Kim, for his part, has included ETF approval in a broader initiative to bolster middle-class wealth, listing it as the fifth of his 10 core campaign pledges. He has also floated the possibility of permitting government entities to invest in digital assets — an idea likely to stir debate among more conservative financial policymakers. Financial authorities in South Korea have taken a cautious approach to cryptocurrency, citing concerns about volatility and systemic risk. However, the administration and ruling party agreed in March to consider allowing spot ETFs, signaling a possible shift in the regulatory landscape. Analysts say the move could democratize access to cryptocurrency investment, enabling individuals to trade digital assets through traditional brokerage accounts without the need for dedicated crypto wallets or direct exchange involvement. Within Lee’s campaign, a newly formed Digital Asset Committee met for the first time Tuesday to begin crafting a comprehensive regulatory framework. Topics under review include the treatment of stablecoins, non-fungible tokens (NFTs), and security token offerings (STOs). Kim’s party unveiled its own seven-point crypto platform last month, which proposes dismantling the longstanding “one exchange, one bank” policy and establishing clearer legal parameters for business engagement in the digital asset space. Yet the candidates part ways on the question of won-backed stablecoins. Lee supports their creation as a tool to curb capital outflows, a position criticized by Lee Jun-seok of the minor Reform Party, who dismissed the idea as indicative of “a lack of understanding of market realities.” 2025-05-14 11:06:15

South Korea's AI-generated games face regulatory hurdles SEOUL, May 13 (AJP) - South Korea’s game industry is bracing for heightened regulatory oversight as lawmakers confirm that video games utilizing artificial intelligence will fall under the country’s new Artificial Intelligence Basic Law, set to take effect in January 2026. According to a report released Tuesday by the National Assembly Research Service, games that employ generative AI models are likely to be classified as “AI products,” placing them under a regulatory framework that includes strict disclosure requirements and risk assessments overseen by the Ministry of Science and ICT. The AI Basic Law, enacted earlier this year, requires companies to clearly indicate when AI-generated content is used in their products and to conduct comprehensive evaluations of potential risks. These must be formally submitted to government authorities. Parliamentary researchers concluded that AI-powered non-player characters (NPCs) with natural language capabilities, as well as games with in-game tools that generate content, would fall squarely within the law’s purview. Among the most prominent titles potentially affected is inZOI, a forthcoming life simulation game from Krafton that is currently in early access. The game features AI-generated 3D printing, text-to-image functionality, and video-to-motion tools. Planned integration of natural language processing would likely trigger additional compliance obligations. Even games that utilize AI-generated visuals, music, or graphics during development — regardless of subsequent human modification — could be subject to the law’s provisions. “Even if generative AI results underwent human revision or editing before being used in games, companies would still need to fulfill their obligations under the AI Basic Law if their game qualifies as an ‘AI product,’” the research service noted. The legislation mandates that companies clearly label AI-generated material that could be mistaken for human-created content. This includes visual imagery, audio, and video — core elements in modern game development. The use of widely available tools such as Stable Diffusion, Midjourney, or ElevenLabs’ synthetic voices would likely require additional disclosures, potentially impacting a significant portion of South Korea’s $17 billion gaming sector. The guidance has sparked concerns across the broader creative industry, echoing apprehensions from film, television, and digital content producers who argue that the regulations could hinder South Korea’s competitive edge in global entertainment markets. “As AI rapidly transforms gaming, blurring traditional creative boundaries, we urgently need balanced policies that protect rights while fostering industrial growth,” said Kang Yu-jung, a lawmaker with the opposition Democratic Party. 2025-05-13 14:05:22