South Korea supports Trump’s policies with massive export financing, according to Reuters

SEOUL (Reuters) – South Korea pledged on Monday to provide significant financial aid to exporters to offset any negative impact of changes in U.S. trade policies as Donald Trump prepares for a second term as president.

The government plans to provide 360 ​​trillion won ($247.74 billion) in policy financing to companies through state-owned banks and institutions this year, the Ministry of Finance announced in a statement.

“There is concern that foreign uncertainties will worsen under the incoming US administration and negatively impact exports,” the ministry said.

The ministry also allocated 1.4 trillion 1.4 trillion won this year, 1.2 trillion won last year, and 2.9 trillion won from 2.1 trillion won for government projects, including trade fairs and delegations, to hedge against foreign exchange volatility. .

Sectors particularly at risk from the new US policies are semiconductors and rechargeable batteries, the ministry said, but the defense, nuclear energy and shipbuilding sectors are more promising as they have gaps for cooperation with the United States.

US President-elect Trump, who takes office on Monday, has vowed to impose tough tariffs on major trading partners such as Mexico, Canada and China, which is expected to affect South Korean companies that operate factories in those countries.

After Asia’s fourth-largest economy reached $55.7 billion in 2024, a 25.4 percent increase from the U.S. in 2023, economists say there is concern that the Trump administration will introduce trade policies against South Korea.

The Korea International Trade Association, South Korea’s largest group of exporting companies, projects export growth of 1.8% this year. Last year, South Korea’s exports rose 8.1 percent to $683.7 billion, while U.S. sales rose 10.4 percent.

($1 = 1,453.1500 won)