Seoul fears rise of new ultra-conservative government in Tokyo may bring out old skeletons SEOUL, October 21 (AJP) - As Japan welcomes its first female state leader, Sanae Takaichi, elected Tuesday as the country’s 104th prime minister, Seoul is watching closely — wary that a rightward turn in Tokyo’s politics could rekindle old tensions. The 64-year-old conservative and head of the ruling Liberal Democratic Party (LDP) won 237 out of 465 votes in the lower house, comfortably surpassing the 233-seat majority threshold. Although the LDP holds 196 seats, Takaichi secured victory in the first round with backing from the Japan Innovation Party (Ishin) and several independent lawmakers. A protégé of the late ultraconservative prime minister Shinzo Abe, Takaichi has pledged to strengthen security ties with the United States and take a harder line against China and North Korea — a stance that contrasts sharply with the Lee Jae Myung administration’s diplomatic approach centered on dialogue, regional inclusivity, and what Seoul officials call “pragmatic diplomacy.” While she has promised continuity with her predecessor Shigeru Ishiba’s policies, her ascent marks a clear ideological shift to the right. Takaichi has long championed “patriotism” in education and asserted stronger sovereignty claims in territorial disputes — positions that could test the fragile thaw between Seoul and Tokyo that began under Ishiba through resumed shuttle diplomacy. For the Lee administration, which came to power in June 2025, the leadership change in Tokyo adds a new layer of uncertainty. President Lee made Japan for his first bilateral visit after taking office, signaling intent to stabilize relations with Tokyo and Washington. Yoshihiro Makino, visiting professor at Hiroshima University, said Seoul hopes to maintain the current momentum but is concerned about possible provocations under Takaichi. “There are concerns that with Takaichi in office, sensitive moves could re-emerge — such as visits to the Yasukuni Shrine, renewed claims over Dokdo, or discussions on the continental shelf agreement,” Makino said. He noted that many of Takaichi’s political allies are deeply attached to historical and territorial issues, heightening the risk of confrontation. “If Japan acts too provocatively, the Lee administration will have no choice but to respond firmly, since public opinion in South Korea reacts strongly to matters of history and sovereignty,” he added. Still, Seoul and Tokyo are expected to find common ground on economic and technological cooperation, particularly in supply chain resilience and semiconductor coordination. Takaichi’s rise also introduces a new variable into the regional power equation among Washington, Tokyo, and Seoul. Both Japan and the United States are now under conservative leadership, but their approaches to North Korea diverge. U.S. President Donald Trump has expressed willingness to reopen dialogue with North Korean leader Kim Jong-un, while Takaichi is expected to pursue a more hardline policy toward Pyongyang. In this shifting regional dynamic, Seoul’s ability to balance between Washington’s unpredictable diplomacy and Tokyo’s tougher stance will be critical in defining South Korea’s role on the Korean Peninsula. 2025-10-21 18:05:25

Red-hot streak of Korean chip stocks spills over to downstream suppliers SEOUL, October 21 (AJP) - South Korea’s semiconductor rally shows no sign of slowing, as record gains by memory giants ripple through the broader chip value chain, drawing in downstream suppliers and equipment makers amid growing concerns over a looming memory shortage in the AI era. Memory bellwethers Samsung Electronics and SK hynix both came close to symbolic six-digit milestones—100,000 won and 500,000 won, respectively. Samsung Electronics closed Tuesday 0.4 percent lower at 97,700 won ($68) after touching 99,800 won, while SK hynix fell 0.9 percent to 481,000 won after reaching an intraday high of 502,000 won. Their bull run lifted suppliers across the Kosdaq and main exchange KRX. Wonik Holdings, which makes chipmaking equipment and materials, slipped 2.7 percent to 25,250 won on profit-taking after soaring 77 percent this month and more than tenfold from its December low of 2,135 won. Hanmi Semiconductor, a key backend equipment producer, gained 55 percent this month on strong demand for its advanced tools used in high-bandwidth memory (HBM) production. Eugene Tech, which supplies to all three DRAM majors—Samsung, SK hynix, and Micron—ended Tuesday at a record 89,600 won after an intraday high of 92,000 won, tripling from a 52-week low of 30,300 won. Analysts widely agree that the sector is entering a new chip super cycle, fueled by surging AI-related demand, constrained supply, and state-led investment in advanced industries. A recent government task force unveiled a 5.7 trillion won national growth fund to support AI and deep-tech startups and strengthen semiconductor and robotics ecosystems. “Artificial intelligence is rapidly reshaping the global economy, and South Korea’s semiconductor industry will remain at the center of this transformation,” said Kang Sung-jin, professor of economics at Korea University. “The rise of AI in the Fourth Industrial Revolution has made semiconductors indispensable, sustaining bullish momentum in equities. Ongoing U.S.–China tensions also enhance Korean firms’ competitiveness in the U.S. market.” Lee Jong-hwan, professor of system semiconductor engineering at Sangmyung University, noted that both memory and non-memory chips are increasingly vital as AI applications diversify. “AI chips are driving explosive demand across the board,” he said. “Non-memory semiconductors—made by foundries like TSMC and Samsung—are just as crucial for AI systems.” Lee added that the real profits in the AI age come from the hardware, not software. “The firms actually making money are the semiconductor manufacturers enabling AI functionality,” he said. “Today’s strong stock performances by SK hynix and Samsung reflect exactly that.” Calling earlier “AI bubble” fears misplaced, Lee predicted the current uptrend would persist as AI adoption accelerates. He urged continued investment in fabs, workforce, and overseas capacity. “Samsung and SK hynix should sustain aggressive semiconductor investment—both domestically in the Yongin cluster and abroad to navigate U.S. trade and tariff risks. Equipment and materials players will rise in tandem.” 2025-10-21 17:55:46

Samsung fields stronger in-house chip-powered Galaxy to counter AI iPhone hype SEOUL, October 21 (AJP) - Samsung Electronics is equipping half of its upcoming Galaxy S26 lineup with its upgraded in-house processor, the Exynos 2600, to counter rising expectations for Apple’s AI-powered iPhone 17 series and to showcase renewed confidence in its AI chipset design and manufacturing capabilities. The tech giant said the new Exynos delivers more than six times the neural processing power of Apple’s latest A-series chip. The move marks the first time in four years that Samsung is mounting its own application processor on its flagship Galaxy S series, a sign of confidence in both hardware design and software integration. The decision comes as Apple’s tight hardware-software ecosystem and expanding AI investments have lifted its shares to record highs this year. Samsung has long split its premium phones between its Exynos and Qualcomm Snapdragon processors by region. However, earlier overheating and performance issues led the company to exclude Exynos from its Ultra models after 2021. Under the new strategy, Galaxy S26 units sold in Korea and Europe will use the latest Exynos chip, while models shipped to the United States, Japan, and other markets will continue to rely on Snapdragon. The reinstatement reflects Samsung’s confidence in resolving the long-standing issues surrounding its application processor — the “brain” of a smartphone — while also improving profitability. The company spent nearly 10 billion dollars on external AP purchases last year, and analysts note that bringing production back in-house could strengthen margins and ecosystem control. Daishin Securities analyst Ryu Hyung-geun said the Exynos 2600, designed for the Galaxy S26, is Samsung’s first 2-nanometer mobile processor and has shown stronger early-stage performance than its 3-nanometer predecessor. “If the performance was really a problem, Samsung would have no reason to choose it,” countered Kim Yongdae, professor of electrical engineering at KAIST. Samsung’s mobile division, known as MX, reported revenue of 29.2 trillion won and operating profit of 3.1 trillion won in the second quarter of 2025, down from 36 trillion won and 4.1 trillion won in the previous quarter, which had been boosted by Galaxy S25 sales. Third-quarter revenue is projected at around 33 to 34 trillion won, with profit near 3 trillion won, supported by solid demand for the Galaxy Z Fold7, Z Flip7, and higher-end AI-enabled smartphones. Samsung commanded about 19.7 percent of the global top-tier smartphone market in the second quarter, shipping 58 million units — up 7.9 percent from a year earlier — while Apple accounted for roughly 15.7 percent with 46.4 million iPhones, a 1.5 percent increase. In the third quarter, Samsung retained a narrow lead with a 19 percent market share versus Apple’s 18 percent. Sales of Samsung’s flagship devices also improved. The Galaxy S25 series sold about 22.7 million units in the first six months after launch, up 12 percent from 20.8 million for the Galaxy S24 during the same period a year earlier. Domestic sales in Korea surpassed 3 million units, two months faster than the S24. Consumers largely await in suspicion. “The Exynos has always been seen as weaker than Snapdragon, and now they’re putting it even in the Ultra model — that makes no sense,” said Kevin Park, a 33-year-old Galaxy user in Seoul. Built with Samsung’s latest nanometer process, the Exynos 2600 integrates a next-generation neural processing unit for running language models, live translation, and image generation directly on-device without a network connection. Apple is expected to introduce similar AI capabilities through its A18 chip in the iPhone 17 lineup next year. Analysts say on-device AI has become a key differentiator in the smartphone industry, as privacy concerns and cloud costs drive companies to process more data locally. Still, they caution that Samsung must prove its ability to manage heat, battery efficiency, and performance parity with Snapdragon-based models to avoid a repeat of past criticism in Europe and Asia. Globally, tech companies are pursuing chip sovereignty to guard against supply disruptions. Apple designs its A- and M-series chips, Google uses its Tensor processors, and Huawei has revived its Kirin lineup despite U.S. sanctions. Governments in South Korea, China, and the United States are all promoting semiconductor self-reliance, reinforcing the trend. Samsung has yet to disclose shipment targets for Exynos-powered Galaxy S26 devices. Suppliers say production will begin in November, with an official launch expected in early 2025. Whether the shift boosts profitability or revives old controversies will depend on how consumers judge its AI capabilities against Apple’s next-generation iPhones. 2025-10-21 17:54:47

Asian markets rally, KOSPI the world's best performer led by chip boom SEOUL, October 21 (AJP) - Major Asian stock markets closed mostly higher on Tuesday amid easing global trade tensions and improved investor sentiment, while South Korea’s benchmark index stood out as the world’s best performer of the month. In Seoul, the KOSPI closed at a fresh record of 3,814.69, up 1.76 percent from the previous session. The secondary KOSDAQ gained 1.89 percent to close at 875.77. Institutional investors drove the rally with strong buying despite continued foreign selling pressure. Technology stocks led the gains, with SK hynix jumping 4.2 percent to a new high of 485,500 won and Samsung Electronics edging up 0.2 percent to 98,100 won. Japan’s Nikkei 225 surged 3.12 percent to 49,186, supported by optimism over political stability and anticipated fiscal stimulus. Tech and AI-related shares, including SoftBank, Advantest, and Tokyo Electron, were among the top gainers. In Taipei, the TAIEX rose 386.26 points, or 1.41 percent, to close at 27,688.63, lifted by semiconductor stocks such as TSMC, which gained 2.07 percent. Vietnam’s VN-Index also advanced, supported by foreign inflows and resilient domestic investor sentiment despite recent volatility. The index closed near 1,700 points, buoyed by expectations of a market reclassification that could draw greater foreign investment. The rally across Asian markets underscores a cautiously optimistic tone, driven by easing geopolitical tensions and sustained momentum in the region’s semiconductor and technology sectors. 2025-10-21 17:53:37

Reunification becomes a distant dream as living divided feels like the norm for South Koreans SEOUL, October 21 (AJP) - "Our wish is reunification. Even in our dreams, we wish for reunification." For South Koreans who attended elementary school in the 1970s and 1980s, these lyrics are etched in memory — a childhood chorus once sung with conviction. But eight decades after the peninsula was divided in 1945 following liberation from Japanese rule, that wish has all but faded. A growing majority of South Koreans now regard reunification with the North as unnecessary. According to the 2025 Unification Survey released this week by the state-run Korea Institute for National Unification (KINU), 51 percent of respondents said unification is "not necessary," compared with nearly 70 percent expressing similar skepticism in 2014. Support for reunification remains weakest among those born between 1991 and 2000, at just 38 percent. Even among those who experienced the Korean War firsthand, the sentiment has declined — with 70 percent now skeptical of unification, compared with 62.1 percent a decade ago. The data reflect a generational and emotional divide. "We are too different now," said 57-year-old Lee Chun-mi. "The cost and time it would take to unify and integrate both sides would be enormous, and I’m not sure the outcome would be worth it." Others, however, continue to hold on to the hope of peaceful reconciliation. "I wish to see it before I die — but only through a peaceful process, not absorption," said another 57-year-old, Son Chun-ae. Younger South Koreans express similar divisions, oscillating between empathy and indifference. "Yes, unification could help North Koreans find better jobs and create a larger, more talented nation. I want them to live better," said Kim Gi-ri, 27. But Park Sun-min, 25, disagreed: "South Korea is doing well already. We're walking entirely different paths — I don't feel reunification is necessary." Another respondent, Kim Jae-hyun, also in his 20s, added, "Too much time has passed. The economic, political, and social disconnect is now too deep to bridge without major sacrifices." According to Min Tae-eun, a senior research fellow at KINU, the shift in perception is part of a natural evolution. "For many, division has become a normalized reality," she said. "It's not natural — but it's something people have lived with for nearly 80 years, and that familiarity has made it feel normal." For younger South Koreans, daily concerns such as jobs, housing, and economic stability now take precedence over questions of national unity. In the latest survey, 63.2 percent — the highest figure yet — responded that "if South and North can coexist peacefully without war, unification is not necessary." 2025-10-21 17:53:20

Korean defense firms join forces to boost KF-21 fighter jet exports SEOUL, October 21 (AJP) - Korea Aerospace Industries (KAI) said Tuesday it had signed a memorandum of understanding with Hanwha Aerospace, Hanwha Systems, and LIG Nex1 to strengthen the export competitiveness of the KF-21 fighter jet, the country’s 4.5-generation aircraft. Under the agreement, the companies will cooperate to reduce production costs, stabilize supply chains, and jointly market the aircraft overseas. The collaboration also includes sharing technology and market intelligence to reinforce trust and coordination across the defense sector. The KF-21, developed as a cornerstone of South Korea’s ambitions to become a major defense exporter, is viewed as a major milestone in the nation’s aerospace industry. Its success in securing overseas buyers is seen as critical to sustaining the program and boosting the country’s standing in the global arms market, KAI said. Hanwha Aerospace specializes in aircraft engines and power systems, Hanwha Systems develops avionics and radar technologies, and LIG Nex1 produces guided weapons and electronic systems. KAI, which leads the KF-21 program, said the partnership will help “maximize global competitiveness and create export synergy.” “The KF-21 will benefit from strengthened networks with major domestic defense companies, paving the way for securing initial export customers and expanding overseas,” a KAI spokesperson said. “This collaboration is expected to enhance the competitiveness of South Korea’s aerospace defense industry and set a new benchmark for supply chain innovation.” The collaboration marks the latest in a series of government- and industry-led efforts to position the KF-21 as a viable alternative to Western-made jets, particularly in markets seeking advanced but cost-effective fighter options. * This article, published by Aju Business Daily, was translated by AI and edited by AJP. 2025-10-21 17:14:49

JCS chief inspects security and military readiness ahead of next week's APEC summit SEOUL, October 21 (AJP) - The final inspection of key military installations and other security facilities was conducted on Tuesday in preparation for next week's Asia-Pacific Economic Cooperation (APEC) summit, which is set to take place in southern South Korea. Chair of the Joint Chiefs of Staff (JCS) Jin Young-seung flew over the East Sea in a P-8 patrol aircraft and inspected a Marine unit in Pohang, emphasizing military readiness ahead of the multilateral gathering, which is scheduled to take place in the historic city of Gyeongju from Oct. 31 to Nov. 1. He instructed soldiers and personnel to stay on alert and be prepared for various scenarios to ensure security, while emphasizing the importance of information sharing and coordination among relevant agencies to respond promptly to any emergencies. The Ministry of National Defense has also been preparing to support the summit since July, with plans to deploy 2,660 personnel in Gyeongju and nearby areas to assist with maintaining order, providing interpretation services, VIP protection, and other security-related duties. The ministry pledged to maintain vigilance and take all necessary measures to ensure the summit's success. * This article, published by Aju Business Daily, was translated by AI and edited by AJP. 2025-10-21 17:12:36

Naver, Kakao to deliver stronger Q3 as they bet on AI to defend Korean turf SEOUL, October 21 (AJP) - South Korea's leading platform operators Naver and Kakao are expected to post improved third-quarter earnings as they double down on artificial intelligence initiatives to defend their home market from global AI giants. Naver is embedding AI across its search, commerce and fintech operations, while Kakao is weaving the technology into its messenger, content and advertising services to boost data-driven profitability. The two are taking distinct approaches: Naver builds on homegrown technologies, while Kakao leverages partnerships with foreign AI developers to accelerate its catch-up. "In terms of operational stance, Naver puts more weight on business-to-business operations, while Kakao focuses on individual user interaction and feedback, making it stronger in everyday AI use," said Lee Seung-man, professor of artificial intelligence at Seoul Cyber University. "It's hard to compare the two directly, but both are taking different directions in AI integration." Naver's data management arm, Naver Cloud, recently partnered with SK hynix to secure next-generation memory chips aimed at improving AI service response times and reducing costs. The collaboration marks another step in linking software and hardware development across Korea's AI ecosystem. For its flagship search service, Naver introduced AI Briefing, a generative search assistant similar to Google's AI features, and Smart Lens, an image-based exploration tool launched in July to strengthen visual search capabilities. Naver also unveiled HyperCLOVA X Think, an agentic AI model built on its proprietary large language model, HyperCLOVA X. The model has scored higher than domestic peers and leading open-source alternatives in reasoning benchmarks. Its fintech arm, Naver Financial, plans to merge AI with blockchain through a partnership with Dunamu, proposing the issuance of stablecoins on Dunamu's Giwa Chain, which could link directly to Naver Pay. The company is expected to unveil a full roadmap of its AI integration across search, commerce, content and cloud services at its DAN25 conference next month. Kakao, by contrast, has chosen a faster and safer route — integrating OpenAI's GPT-5 into its flagship messaging app KakaoTalk, marking the first direct collaboration of its kind worldwide. Beyond chatbot features, the latest overhaul introduces Instagram-style feeds, new chat-room folder functions, extended message editing up to 24 hours, and AI-powered voice call summaries. In addition, Kakao is deploying its own lightweight on-device AI model, Kanana, with 1.3 billion parameters, reducing reliance on cloud infrastructure and enabling context-aware user experiences. Complementing its OpenAI partnership, Kakao plans to launch its own AI agent features by November. Industry watchers believe Kakao's 49.1 million monthly active users position the firm to scale globally and strengthen its data competitiveness through ChatGPT integration. "KakaoTalk is poised to grow meaningfully as the world's first messenger-based AI super app," said Choi Seung-ho of DS Investment & Securities. As the search market rapidly shifts from portals to conversational interfaces, Kakao aims to build an AI learning ecosystem around KakaoTalk, evolving into a commerce and content hub powered by user data. Its ultimate goal is to connect AI agents with its in-house and partner platforms, gaining network and first-mover advantages. If fully implemented, users could soon request music through AI agents and receive curated playlists from Melon, Kakao's music streaming unit, without leaving KakaoTalk. "Starting from 2026, the integration of KakaoTalk and AI could create new subscription or ad-based business models," said Jung Ho-yoon, analyst at Korea Investment & Securities. "AI benefits will cascade from hardware to cloud services and eventually to consumer-facing companies. The long-term business potential remains broad." Lee added that government support is likely, noting President Lee Jae Myung's repeated emphasis on sovereign AI, with Naver's HyperCLOVA X serving as Korea's representative model. "All IT technologies operate within government regulatory sandboxes, and both Naver and Kakao are adept at aligning with policy directions. Both are on strong growth trajectories," he said. Naver and Kakao are scheduled to release their third-quarter results on November 5 and 7, respectively. Their shares are trading 7.29 percent and 4.57 percent higher over the past three months, reflecting investor confidence in their AI drive. 2025-10-21 16:39:58

Kia opens assembly plant in Kazakhstan to boost Central Asia presence SEOUL, October 21 (AJP) - Kia said on Tuesday that it has opened a new automobile assembly plant in Kostanay, Kazakhstan. Built with an investment of about $310 million, the facility spans 630,000 square meters and can produce up to 70,000 vehicles annually. The plant has begun assembling the Sorento SUV and plans to add production of the Sportage model in 2026. Kia said the new plant would serve as a hub for meeting rising regional demand and advancing localization efforts in the fast-growing Central Asian market. “The Kazakhstan plant is part of Kia’s global vision to create sustainable value through customer-centric innovation and electrification,” Kia President Song Ho-sung said in a statement. The company added that it plans to expand its model lineup based on local market trends and strengthen its supply chain in the region. * This article, published by Aju Business Daily, was translated by AI and edited by AJP. 2025-10-21 15:25:30

South Korea's finance chief urges focus on AI transition at APEC ministers' meeting SEOUL, October 21 (AJP) - South Korea’s Finance Minister, Koo Yun-cheol, called on Asia-Pacific nations on Tuesday to channel resources into artificial intelligence as a key driver of economic growth, urging policymakers to foster innovation and strengthen private-sector participation. “In the era of AI transformation, we must create an innovation-friendly environment and support the private sector,” Koo said at the opening of the Asia-Pacific Economic Cooperation (APEC) Finance and Structural Reform Ministers’ Meeting in Incheon. “South Korea prioritizes AI across all sectors to boost potential growth.” The three-day meeting, held until Oct. 23 at the Inspire Resort, brings together finance ministers and senior officials from 21 APEC economies. It marks the first time in two decades that South Korea has hosted the forum. This year’s agenda, themed “Innovation, Finance, and Fiscal Roles for Sustainable Growth,” centers on shaping a new five-year framework known as the Incheon Plan — a successor to the 2015 Cebu Action Plan. The initiative aims to strengthen innovation, fiscal resilience, and financial inclusion across the region. Discussions this week are expected to address how artificial intelligence can reshape productivity and innovation, along with policies to promote digital finance, fiscal sustainability, and access for vulnerable populations. “The Incheon Plan will be the most significant outcome of this year’s APEC finance track,” Koo said, expressing hope that the talks would help “set a clear direction for the region’s shared prosperity.” More than 2,000 participants — including representatives from the International Monetary Fund, the World Bank, and the Organization for Economic Cooperation and Development — are attending the sessions. China and Japan dispatched vice ministers, while the United States is represented by a deputy assistant secretary. The first day’s discussions focused on global and regional economic trends, digital finance, and fiscal policy. Joint sessions on innovation and digitalization are scheduled for Wednesday, followed by a meeting with the APEC Business Advisory Council. The conference will conclude Thursday with a joint press briefing outlining the group’s commitments. * This article, published by Economic Daily, was translated by AI and edited by AJP. 2025-10-21 15:13:56