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Asia News Network

4 hours ago

Business
Asia News Network

Take down hurdles: The Korea Herald

August 1, 2025 SEOUL – The global success of 'KPop Demon Hunters,' an animated film released on Netflix in June, has provided an unexpected boost to Korea's soft power. The film, in which a fictional K-pop girl group battles demons with music-infused powers, has topped streaming charts in over 30 countries and propelled its soundtrack to second place on the Billboard 200. But perhaps more telling than the film's entertainment value is what it revealed about Korea's export potential and its limitations. While fans from Singapore to the Netherlands eagerly bought Korean goods tied to the movie's characters — from folk-art-inspired souvenirs to traditional accessories — the process of buying those products was anything but smooth. Korean cultural products may now command a powerful emotional pull globally, but the infrastructure for overseas consumers to access Korean products, especially through e-commerce, remains strikingly inadequate. According to the Bank of Korea, South Korea's cross-border e-commerce exports to individual consumers overseas — often referred to in Korea as 'reverse direct purchases' or 'yeok-jikgu' in Korean — totaled 1.6 trillion won ($1.1 billion) last year. It was just one-fifth the volume of inbound direct purchases by Korean consumers from overseas retailers. The data shows that Korea's e-commerce platforms have failed to capitalize on foreign demand despite the surging popularity of Korean entertainment, beauty and food. Much of the problem lies in unnecessary procedural bottlenecks. Most domestic platforms still require identity verification through a Korea-registered mobile number, even though no legal obligation mandates this. International consumers, even if motivated to purchase, are routinely blocked during the sign-up process. Those who clear that hurdle often encounter another at checkout, where many Korean sites do not accept international payment methods like Visa, Mastercard, PayPal or Alipay. The result is a highly restrictive system that effectively turns away willing customers. By contrast, major platforms like Amazon, AliExpress and Temu allow foreign users to register and pay with minimal friction. These companies conduct their own verification using standard card information or global e-wallets, lowering entry barriers while managing fraud risks internally. Chinese e-commerce platforms operating in South Korea have even integrated domestic systems such as Naver Pay to localize their offerings. Yet Korean platforms have been reluctant to reciprocate even as global demand for Korean goods rises. This hesitation reflects both rigid regulatory constraints and an outdated culture of risk aversion, especially around identity theft, fraud and payment disputes. But technological solutions already exist. Viable steps Korean retailers can take include integrating payment systems that are popular in target markets, adopting user-friendly authentication procedures and expanding their overseas fulfillment capabilities. The Korean government and regulators have a critical role to play. The Bank of Korea's recent recommendation — to simplify account verification, provide legal clarity around non-Korean sign-ups and actively embrace global payment tools — is a necessary starting point. More broadly, failure to liberalize South Korea's e-commerce model may deepen the structural imbalance in digital trade. As global commerce increasingly revolves around platforms rather than physical intermediaries, the country cannot afford to remain digitally insular. Ironically, the very appeal of 'KPop Demon Hunters' — its seamless fusion of traditional Korean motifs with contemporary music and lively animation — highlights what the country does best: Marrying heritage and innovation in ways that resonate globally. But turning cultural capital into economic return will require an equally imaginative overhaul of Korea's digital marketplace. Nearly a decade after the so-called 'Cheon Song-yi coat' moment, when a Korean drama ignited global fashion interest and prompted calls for easier reverse purchases, progress has been woefully limited. The nation's major platforms still operate largely as if their only customers are local. That must change. With global attention now fixed on Korean products, the least the country can do is avoid shutting the door on K-culture's global rise.

Korea Herald

10 hours ago

Business
Korea Herald

[Editorial] Take down hurdles

Korean platforms shut out global fans with outdated rules while Korean culture surges The global success of 'KPop Demon Hunters,' an animated film released on Netflix in June, has provided an unexpected boost to Korea's soft power. The film, in which a fictional K-pop girl group battles demons with music-infused powers, has topped streaming charts in over 30 countries and propelled its soundtrack to second place on the Billboard 200. But perhaps more telling than the film's entertainment value is what it revealed about Korea's export potential and its limitations. While fans from Singapore to the Netherlands eagerly bought Korean goods tied to the movie's characters — from folk-art-inspired souvenirs to traditional accessories — the process of buying those products was anything but smooth. Korean cultural products may now command a powerful emotional pull globally, but the infrastructure for overseas consumers to access Korean products, especially through e-commerce, remains strikingly inadequate. According to the Bank of Korea, South Korea's cross-border e-commerce exports to individual consumers overseas — often referred to in Korea as 'reverse direct purchases' or 'yeok-jikgu' in Korean — totaled 1.6 trillion won ($1.1 billion) last year. It was just one-fifth the volume of inbound direct purchases by Korean consumers from overseas retailers. The data shows that Korea's e-commerce platforms have failed to capitalize on foreign demand despite the surging popularity of Korean entertainment, beauty and food. Much of the problem lies in unnecessary procedural bottlenecks. Most domestic platforms still require identity verification through a Korea-registered mobile number, even though no legal obligation mandates this. International consumers, even if motivated to purchase, are routinely blocked during the sign-up process. Those who clear that hurdle often encounter another at checkout, where many Korean sites do not accept international payment methods like Visa, Mastercard, PayPal or Alipay. The result is a highly restrictive system that effectively turns away willing customers. By contrast, major platforms like Amazon, AliExpress and Temu allow foreign users to register and pay with minimal friction. These companies conduct their own verification using standard card information or global e-wallets, lowering entry barriers while managing fraud risks internally. Chinese e-commerce platforms operating in South Korea have even integrated domestic systems such as Naver Pay to localize their offerings. Yet Korean platforms have been reluctant to reciprocate even as global demand for Korean goods rises. This hesitation reflects both rigid regulatory constraints and an outdated culture of risk aversion, especially around identity theft, fraud and payment disputes. But technological solutions already exist. Viable steps Korean retailers can take include integrating payment systems that are popular in target markets, adopting user-friendly authentication procedures and expanding their overseas fulfillment capabilities. The Korean government and regulators have a critical role to play. The Bank of Korea's recent recommendation — to simplify account verification, provide legal clarity around non-Korean sign-ups and actively embrace global payment tools — is a necessary starting point. More broadly, failure to liberalize South Korea's e-commerce model may deepen the structural imbalance in digital trade. As global commerce increasingly revolves around platforms rather than physical intermediaries, the country cannot afford to remain digitally insular. Ironically, the very appeal of "KPop Demon Hunters" — its seamless fusion of traditional Korean motifs with contemporary music and lively animation — highlights what the country does best: Marrying heritage and innovation in ways that resonate globally. But turning cultural capital into economic return will require an equally imaginative overhaul of Korea's digital marketplace. Nearly a decade after the so-called 'Cheon Song-yi coat' moment, when a Korean drama ignited global fashion interest and prompted calls for easier reverse purchases, progress has been woefully limited. The nation's major platforms still operate largely as if their only customers are local. That must change. With global attention now fixed on Korean products, the least the country can do is avoid shutting the door on K-culture's global rise.

Reuters

2 days ago

Business
Reuters

South Korea exports to rise in July ahead of US tariff deadline: Reuters poll

SEOUL, July 30 (Reuters) - South Korea's exports likely climbed in July for a second straight month on robust chip sales and frontloading ahead of a U.S. tariff deadline, a Reuters poll showed on Wednesday. Exports from Asia's fourth-largest economy are forecast to have risen 4.6% from a year earlier, according to a median estimate from a survey of 22 economists. That would be slightly faster than the 4.3% increase in June and mark the biggest gain since December 2024. Data for the first 20 days of the month showed exports fell 2.2% as shipments to the U.S. and China - its biggest trading partners - declined, although semiconductor exports jumped 16.5%. U.S. President Donald Trump has threatened South Korea with 25% tariffs, and officials are scrambling to clinch a trade deal before an August 1 deadline. Trade rival Japan last week signed an agreement lowering its tariffs to 15%, adding to pressure on Seoul to make a deal that is at least no worse. The second half of the year is set to be much tougher for the country's exporters. "It is inevitable there will be an overall shock to U.S.-bound exports, because the possibility is high that the tariff rate on South Korea will at least be 15% or higher even after trade negotiations," said Chun Kyu-yeon, an economist at Hana Securities. The Bank of Korea said last week that U.S. tariffs would start to weigh on exports from the third quarter. Robust tech exports in the second quarter helped the trade-reliant economy grow at its fastest pace in more than a year. The median estimate for July trade balance stood at a surplus of $5.36 billion, narrower than June's $9.08 billion, which was the biggest since September 2018. Imports were projected to have increased 2.0% after gaining 3.3% in June. South Korea - the first major exporting economy to report trade figures each month - is scheduled to release data for July on Friday, August 1, at 9 a.m. (0000 GMT).

Bank of Korea board members saw more interest rate cuts necessary

New Straits Times

3 days ago

Business
New Straits Times

Bank of Korea board members saw more interest rate cuts necessary

SEOUL: Board members of South Korea's central bank said there was a need to lower interest rates and cited US trade talks as a key factor to consider for the pace and timing of further cuts, at their latest meeting on July 10, minutes showed on Tuesday. The Bank of Korea kept its benchmark interest rate unchanged at 2.50 per cent at the meeting, but a majority of board members signalled another rate cut in the next three months and warned of "significant" economic uncertainty from US tariffs. "Uncertainty surrounding the future growth trajectory remains significantly high, particularly due to trade negotiations with the United States," one member said, arguing the board should maintain an accommodative policy stance to support weak growth. One member concurred by saying "it is time to consider an additional rate cut", while another member said "the need for base rate cuts still remains". Board members cited developments in the country's trade talks with the US as a key factor for the future policy path, as South Korean officials scramble to try to clinch a deal that reduces tariffs. South Korean Finance Minister Koo Yun-cheol said on Tuesday he would seek a mutually beneficial trade deal when he meets US Treasury Secretary Scott Bessent for talks this week, just days before an Aug 1 deadline expires to avoid punishing tariffs.

CNA