Harmful chemicals detected in children's toys from Chinese e-commerce platforms Key chains with hazardous substances sold on Chinese e-commerce site. Courtesy of Seoul Metropolitan Government SEOUL, April 24 (AJP) - Several children’s toys sold on major Chinese e-commerce platforms contain toxic substances at levels far exceeding safety standards, the Seoul Metropolitan Government announced on Thursday. City officials said they tested 25 toys purchased from global platforms including Temu, Shein, and AliExpress. Four products failed to meet domestic safety regulations, with one “keyring doll” found to contain phthalate plasticizer (DEHP) at concentrations up to 278 times the permitted limit in its face, hands, and feet. DEHP, or di(2-ethylhexyl) phthalate, is classified by the International Agency for Research on Cancer as a potential human carcinogen. It is also known to disrupt endocrine function and has been linked to reproductive harm. Other items flagged in the inspection included modeling clay that contained CMIT (chloromethylisothiazolinone) and MIT (methylisothiazolinone), chemical preservatives banned in humidifier disinfectants in South Korea after being implicated in a public health crisis. Exposure to these substances at elevated levels can cause severe irritation to the skin, eyes, and respiratory system. In addition to chemical hazards, two educational toys failed physical safety assessments. One toy, designed in the shape of a weighing scale, had dangerously sharp base plates that posed puncture risks. Another toy — a sorting game involving clips and fabric balls — lacked proper safety labeling and was found to develop sharp edges when damaged. In response, Seoul officials have formally requested that the e-commerce platforms remove the non-compliant products from sale. Authorities also issued a public advisory urging caution when purchasing children's products via international direct-to-consumer websites. The city government said it would expand the scope of its inspection in May to include children’s textile items, anticipating a surge in seasonal demand ahead of Children's Day on May 5. 2025-04-24 15:19:26

South Korea's economy shrinks in first quarter A snack bar in Seoul preparing for opening/ Yonhap SEOUL, April 24 (AJP) - South Korea’s economy contracted in the first quarter of 2025, weighed down by a prolonged political uncertainty and concerns about U.S. tariffs, according to preliminary data released by the Bank of Korea on Thursday. Gross domestic product fell 0.2 percent from the previous quarter, marking the country’s second economic contraction in just three quarters. The latest reading sharply contrasts with the central bank’s earlier forecast of 0.2 percent growth and raises fresh doubts about the viability of its full-year growth target of 1.5 percent. The bank attributed the downturn to a confluence of headwinds, including prolonged political uncertainty, anxiety over U.S. trade policy, record-setting wildfire damage, and a temporary halt in operations at multiple construction sites. Private consumption edged down 0.1 percent as households cut back on entertainment, cultural activities, and medical services. Government spending also dipped 0.1 percent, largely due to reduced healthcare expenditures. The steepest declines came from investment. Construction investment plunged 3.2 percent — with building construction particularly hard hit — while facilities investment fell 2.1 percent, driven by reduced spending on machinery, including semiconductor manufacturing equipment. Exports, a key pillar of South Korea’s economy, slipped 1.1 percent amid weak demand for chemical products, machinery, and industrial equipment. Imports fell more sharply, declining 2.0 percent, mainly due to decreased purchases of crude oil and natural gas. Among industry sectors, electricity, gas and water services posted a robust 7.9 percent gain, while agriculture, forestry and fishing rose 3.2 percent, buoyed by strong performance in the fishing industry. Real gross domestic income, a measure of purchasing power, declined 0.4 percent, underscoring the mounting challenges facing Asia’s fourth-largest economy. 2025-04-24 10:57:06

SK hynix posts soaring profits on surging AI chip demand SK hynix headquarters in Icheon, Gyeonggi Province/ Yonhap SEOUL, April 24 (AJP) - SK hynix reported a sharp rise in first-quarter profits on Thursday, fueled by surging demand for advanced memory chips used in artificial intelligence applications. The company’s operating profit jumped 157.8 percent from a year earlier to 7.44 trillion won, or about $5.21 billion, according to a regulatory filing. Revenue rose 41.9 percent to 17.64 trillion won, while net profit soared 323 percent to 8.11 trillion won. “The memory market improved faster than expected in the first quarter as AI development competition intensified alongside inventory buildup demand,” SK hynix said in a statement. The firm credited its strong performance to expanded sales of premium products, including its fifth-generation HBM3E 12-layer high-bandwidth memory chips and DDR5 memory modules — key components commanding high prices in the growing AI market. Despite the typically slow first quarter for the industry, SK hynix’s operating profit margin climbed to 42 percent, extending its streak of profitability growth to eight consecutive quarters. 2025-04-24 09:46:53

Prosecutors raid Korea Zinc, brokerages in market manipulation probe Korea Zinc's logo/ Courtesy of Korea Zinc SEOUL, April 23 (AJP) - Prosecutors raided the headquarters of Korea Zinc and several major brokerage firms on Wednesday as part of a widening investigation into allegations of unfair trading practices tied to a multibillion-dollar rights offering announced last year. Investigators from the Southern Seoul District Prosecutors’ Office carried out search and seizure operations at six corporate offices and five private residences, including those of Korea Zinc executives and branches of Mirae Asset Securities and KB Securities. Authorities confiscated computers, internal communications, approval records, and other documents as they examine whether the company breached capital market laws in the lead-up to its 2.5 trillion won (approximately $1.75 billion) rights issue announced in October 2024. The probe follows a referral by the Financial Supervisory Service in January, after questions surfaced over Korea Zinc’s disclosure practices during the period of a share buyback program conducted between October 4 and 23 of last year. During that time, the company publicly stated it had “no plans to make changes to its financial structure following the buyback.” However, prosecutors are now scrutinizing whether Korea Zinc’s board had already been engaged in planning the rights issue — potentially misleading the market. According to local media reports, Mirae Asset Securities, the lead underwriter, commenced due diligence for the offering on Oct. 14, well before the official announcement on Nov. 6. Regulators later ordered Korea Zinc to amend its securities filings, saying the disclosures could have misled investors. The company ultimately withdrew its rights offering plan on Nov. 13, only a week after it was made public. At the center of the investigation is whether Korea Zinc sought to manipulate the market by repurchasing and canceling shares, then planning to issue new ones — a tactic that could constitute illegal market manipulation. The raid is the first major prosecutorial action against Korea Zinc since a high-profile management dispute erupted last year, when private equity firm MBK Partners allied with Young Poong Group in a hostile takeover attempt. That battle has since escalated into a series of legal entanglements. 2025-04-23 16:20:02

Tariff tensions between US and China will dent Korea's growth: report Flags of U.S. and China/ Reuters-Yonhap SEOUL, April 23 (AJP) - South Korea's economy could see its growth rate shaved by as much as half a percentage point this year if trade tensions between the United States and China continue to escalate, according to a report from Citigroup. The analysis underscores the deepening vulnerability of export-driven economies like South Korea's amid intensifying geopolitical frictions between the world’s two largest economies. Even under scenarios in which Seoul manages to secure more favorable terms with Washington, economists warn that the broader conflict could deliver a lasting blow to growth. "Even if U.S.-Korea trade negotiations conclude successfully, the continued conflict between the U.S. and China will make it difficult to substantially alleviate the negative impact of tariffs on growth rates," said Kim Jin-wook, chief economist at Citi Research. The report outlines three trade scenarios with varying degrees of severity. In the most adverse cases, where tariffs remain high and retaliatory measures persist, South Korea's gross domestic product could shrink by 0.5 percentage points this year, with deeper declines of up to 2.3 percentage points projected by 2026. Those conditions could prompt the Bank of Korea to cut its benchmark interest rate sharply — from the current 2.75 percent to as low as 1.00 percent by the end of next year. A more optimistic outlook assumes easing tensions between Washington and Beijing, including a significant reduction in Chinese retaliation. Under this scenario, South Korea's economic drag would be more modest, with growth trimmed by just 0.2 percentage points this year and 0.9 points in 2026. The central bank would likely respond with a milder rate cut to 2.00 percent. Citigroup had initially forecast 2025 growth at 0.8 percent and 1.6 percent for 2026, but noted that its projections carry a high degree of uncertainty due to the unpredictable nature of global trade policy. 2025-04-23 14:46:29

Prosecutors take over high-profile stock manipulation case linked to former first lady Sambu Construction headquarters/ Yonhap SEOUL, April 23 (AJP) - South Korea’s financial watchdog said it will refer a high-profile stock manipulation case possibly involving the country’s former first lady, Kim Keon Hee, to prosecutors on Wednesday. The Securities and Futures Commission, which oversees investigations into irregularities in the nation’s financial markets, will vote during its regular meeting on filing criminal complaints against individuals implicated in the manipulation of shares in Sambu Construction. The anticipated move comes more than seven months after the Korea Exchange forwarded its findings on suspicious trading activity to the Financial Supervisory Service (FSS), the country’s top financial regulator. “It is difficult to deny that certain stakeholders realized profits of more than 10 billion won,” or approximately $7.4 million, said Lee Bok-hyun, the head of the FSS, during a press briefing in early March. He added that the agency aimed to “resolve the matter within April if possible.” The regulator has examined more than 200 trading accounts, including those of major shareholders, in its investigation. Officials said they analyzed trading patterns and capital flows to trace the origin of the illicit profits. Shares of Sambu Construction skyrocketed from roughly 1,000 won in May 2023 to more than 5,000 won by July of that year. During this period, DYD, the company’s largest shareholder, participated in a Ukraine reconstruction forum held in Poland, further raising questions about market sentiment and timing. The case has drawn particular attention due to the involvement of Lee Jong-ho, the former head of Blackpearl Invest and a key figure in the Deutsche Motors stock manipulation scandal, which has also been linked to Kim Keon-hee. Lee is believed to have referenced Sambu Construction in a group chat with former Marine Corps members, posting a cryptic message that read, “Sambu check," before the stock price began soaring. Sambu Construction has been under mounting financial pressure. Trading of its shares has been suspended following two consecutive years of adverse audit opinions. The firm entered court-led rehabilitation proceedings last month as it faces a deepening liquidity crisis. 2025-04-23 11:29:14

Korea urged to boost efforts to stabilize pharmaceutical supply chains Getty Images Bank SEOUL, April 22 (AJP) - South Korea is lagging behind other major nations in implementing systems to address pharmaceutical supply chain instabilities, according to a report by the Korea Institute of Science&Technology Evaluation and Planning (KISTEP). In its latest edition of "Science, ICT Policy and Technology Trends," KISTEP underscores the urgent need for specific legislation and comprehensive mapping of supply chains to ensure a stable supply of medications during crises. The report calls attention to the vulnerabilities exposed by the COVID-19 pandemic and emphasizes the necessity of preparing for future disruptions. “While major nations have adopted phased measures to tackle pharmaceutical supply chain instabilities, South Korea’s efforts remain comparatively insufficient,” said Jeong Soon-kyu, principal researcher at the Korea Health Industry Development Institute. Although South Korean authorities have supported research and development for emerging epidemics and promoted domestic manufacturing of essential medications, the report highlights significant gaps in other areas. These include inadequate support for domestic companies to secure raw materials, expand manufacturing facilities, and localize ingredient production. Such deficiencies leave the country vulnerable to global supply chain disruptions. Currently, China and India dominate the global production of pharmaceutical ingredients, accounting for 44 percent and 20 percent, respectively. South Korea’s reliance on imports for these critical components underscores the need for enhanced domestic production capabilities. The report noted that the country has faced persistent medication shortages, with 46 essential drugs either ceasing production or importation over a three-year period. As of April last year, 490 medications were identified as facing supply instabilities, including 95 designated as essential or shortage-prevention drugs. Jeong warned that rapidly shifting global supply chains, shaped by geopolitical tensions, climate disasters, and economic uncertainties, further complicate the situation. “Swift collection and utilization of accurate information are increasingly critical in managing supply chain risks,” he said, pointing to the impacts of U.S.-China tensions, Middle East conflicts, the Russia-Ukraine war, and climate-related disasters. To address these challenges, the report recommends increased government support for domestic pharmaceutical companies. Proposed measures include facilitating technology exports to U.S. firms, enabling contract manufacturing arrangements, acquiring overseas production facilities, and improving access to procurement opportunities for biosimilars in European markets. Jeong also highlighted South Korea’s advanced ICT capabilities as a potential asset in mitigating supply chain vulnerabilities. Integrating technologies such as big data, artificial intelligence, and blockchain into pharmaceutical supply chains could enhance crisis response and improve efficiency in identifying and addressing weaknesses. The report advocates for a comprehensive approach to supply chain management, encompassing risk assessment, investment in manufacturing capacity, and strategic stockpiling of essential medications. It also emphasizes the need for governance frameworks that support sustained policy implementation. Jeong expressed optimism about the potential for progress. “With sustained government support over the next five years, South Korea could establish a holistic system for pharmaceutical supply stabilization, resolving supply shortages for specific medications by 2030,” he said. 2025-04-22 13:48:19

Major banks may face sanctions over alleged collusion on mortgage terms KB Kookmin, Shinhan, Woori ATMs in downtown Seoul/ Yonhap SEOUL, April 22 (AJP) - South Korea’s antitrust watchdog has wrapped up a re-investigation into allegations that the country’s four largest banks colluded on mortgage lending practices, with regulatory sanctions expected to follow in the coming months. The Fair Trade Commission (FTC) has issued formal examination reports to KB Kookmin, Woori, Shinhan, and Hana banks, according to industry sources. The case centers on claims that the lenders shared approximately 7,500 data points related to loan-to-value (LTV) ratios — key figures that determine how much homebuyers can borrow against their property’s value. Investigators say the exchanges may have allowed the banks to align lending conditions, restrict competition, and boost profits at the expense of borrowers. The investigation, which began in early 2023, was initially expected to conclude last year but was extended after the commission opted to conduct further on-site inspections and gather additional evidence. Inspectors visited the banks in February and spent two months compiling the revised examination report. The updated report, according to sources, bolsters claims that the data-sharing practice materially influenced lending terms. However, it also walks back an earlier recommendation for criminal prosecution, focusing instead on administrative penalties. Notably, the FTC has widened the revenue base used to calculate fines to include loan extensions in addition to newly originated mortgages — a move that could result in penalties amounting to billions of won. The banks have denied any collusion, arguing that while information was shared, it did not result in uniform lending practices. They point to discrepancies in their LTV ratios after the exchanges as evidence of independent decision-making. “The deadline for the banks to submit their opinions is expected in early May,” one industry official said. “A final decision could be announced by late May or early June.” If confirmed, the sanctions would represent the first enforcement action under the “information exchange collusion” clause added to South Korea’s Fair Trade Act in 2020 — a legal provision designed to address more subtle forms of market coordination. A spokesperson for the Fair Trade Commission declined to comment, saying, “We cannot confirm specific details of the case.” 2025-04-22 10:35:14

South Korea cracks down on origin fraud in exports to US A Korea Customs Service officer explains cases of falsely labeled exports to the United States, April 21, 2025. Yonhap SEOUL, April 21 (AJP) - South Korean customs officials have uncovered a surge in falsely labeled exports to the United States during the first quarter of 2025, raising concerns over a growing trend of trade fraud aimed at circumventing punitive American tariffs. The Korea Customs Service (KCS) announced Monday that it has launched a special trade security investigation unit focused on combating origin fraud in exports — specifically targeting products subject to U.S. anti-dumping duties and import restrictions. Officials say that foreign-made goods are increasingly being disguised as South Korean in origin through tactics such as label substitution and forged documentation, in order to exploit South Korea’s preferential trade status with the United States. In the first three months of 2025 alone, authorities have identified approximately 28.5 billion won (about $20 million) worth of goods falsely labeled as Korean in origin — already exceeding the full-year total of 21.7 billion won reported in 2024. While South Korea's reputation for manufacturing quality has long been leveraged by unscrupulous exporters, recent cases indicate a growing shift toward using false labeling explicitly to dodge U.S. tariffs. In one case last November, customs officials intercepted a Chinese mattress manufacturer attempting to export products with falsified Korean certificates of origin. More recently, in January, authorities uncovered a Chinese-owned company operating in South Korea that was exporting Chinese-made lithium battery cathode materials to the U.S. under fraudulent Korean origin claims. “Export circumvention through origin fraud can severely undermine the credibility of legitimate Korean products and risk triggering expanded non-tariff barriers,” said Ko Kwang-hyo, commissioner of the Korea Customs Service, following a public-private sector meeting. The agency said it is bolstering cooperation with industry stakeholders to improve information sharing and enforcement capacity in an effort to protect domestic manufacturers and uphold the integrity of South Korea’s trade commitments. 2025-04-21 15:15:39

Korea's customs revenue shrinks amid free trade push Containers stacked at Busan Port/ Yonhap SEOUL, April 21 (AJP) - South Korea’s customs duty revenue has dwindled to just 0.6 percent of total tax income, a sharp decline driven by an aggressive expansion of free trade agreements and the use of tariff quota mechanisms. In contrast, the United States has seen its customs receipts rise to 1.6 percent of total tax revenue, reflecting a more protectionist trade stance. According to a report released by the National Assembly Budget Office, South Korea collected 7 trillion won (approximately $4.93 billion) in customs duties last year — down 300 billion won, or 4.3 percent, from the previous year. The decline in customs revenue mirrors a broader contraction in trade activity and tariff obligations. South Korean imports dropped by 1.7 percent in 2024, falling from $643 billion in 2023 to $632 billion. Meanwhile, the country’s growing network of trade pacts continues to erode the tax base once supported by import duties. The nation’s effective tariff rate has dropped significantly — from 1.7 percent in 2012 to just 0.8 percent in 2024. South Korea now maintains 22 FTAs encompassing 59 countries, including major economic partners such as the United States, China, and the European Union. Further liberalization came with the implementation of the Regional Comprehensive Economic Partnership (RCEP) in February 2022. The agreement, which includes 15 countries across Asia-Pacific — including China, Japan, Australia, and New Zealand — established de facto free trade between Seoul and Tokyo, two of the region’s largest economies. The United States, by contrast, has moved away from trade liberalization in recent years. Under President Donald Trump, customs revenue as a share of federal tax income rose from 1.1 percent in 2014 to 1.9 percent in 2019. It has remained in the 1.7 to 1.8 percent range in the years since. Officials in Seoul have expressed concern that Washington’s continued reliance on high tariffs, particularly those aimed at China, may have indirect effects on Korea’s export-oriented economy. “If China’s exports to the U.S. decrease due to America's high tariff policy against China, there are concerns that South Korea’s intermediate goods exports to China could decline,” an official from the National Assembly Budget Office said. The agency also warned that escalating global trade tensions — sparked by retaliatory tariff measures between the U.S. and China — could create additional uncertainty and weigh on global economic growth. “In the long term, there is a possibility that the world economy and trade could slow down,” the report noted. 2025-04-21 11:02:51