South Korea

Joongang Ilbo | English | News | Nov. 7, 2025 | UndeterminedInvestor Sentiment

Korea's foreign financial assets reached $2.7 trillion by mid-2025, more than seven times their level two decades ago, with net foreign assets surpassing $1 trillion at the end of 2024. This growth has been driven by a current account surplus stemming from strong exports, modest imports, and rising income from overseas investments. By June 2025, these assets amounted to 55% of the country's GDP, indicating that over half of Korea’s annual national income is held abroad.

The increasing enthusiasm of Korean retail investors, known as seohak ants, towards foreign stocks—especially in the US—has contributed to this rise in net foreign assets. While this trend strengthens Korea's external financial position, the Bank of Korea (BOK) warned that it undermines the domestic investment base, puts downward pressure on the Korean won, and elevates exposure to global financial risks. A paradox exists where Korea’s current account surplus is offset by capital outflows, causing a capital account deficit and weakening domestic investment.

The BOK also noted that an aging population and expanding foreign investments by public pension funds and institutions will likely continue to increase net foreign assets. Retail and institutional investors have shifted from foreign reserves and bank investments to private investing abroad. Korean retail investors made a record $6.81 billion net purchase in overseas stocks in October 2025, the highest monthly level since 2011.

According to the Korea Development Institute (KDI), Korea’s net investment income has increased significantly since 2000, rising from 0.7% to 4.1% of GDP between 2015 and 2024, attributed to declining domestic productivity. This shift towards overseas investments at the expense of domestic investment risks weakening Korea’s long-term economic growth. Lower productivity reduces GDP both directly and indirectly by discouraging capital investment.

Japan's similar experience is highlighted, where net foreign assets reached 55% of GDP in 2009 and 83% by the end of 2024, but a "value-up program" launched in 2023 helped reverse trends by improving corporate governance and capital efficiency. The BOK suggests Korea adopt similar measures—enhancing the domestic investment environment, securing MSCI Developed Market Index inclusion, and encouraging domestic pension fund investments—to strengthen its capital market and domestic investment.

Experts also recommend fostering a more dynamic market for startups and unviable firms and building a flexible labor market to improve productivity and sustain economic vitality.

Korea Herald | English | News | Nov. 7, 2025 | Climate Change

UN Secretary-General Antonio Guterres stated that overshooting the 1.5 degrees Celsius global warming target above pre-industrial levels is now inevitable in the short term. He warned that temperatures will exceed 1.5 C in the coming years, leading to devastating but predictable impacts. However, Guterres noted that if global leaders commit seriously to achieving net zero greenhouse gas emissions, limiting warming to 1.5 C by the end of the century remains possible.

Guterres criticized current national carbon reduction pledges, which cover 70 percent of global emissions, as insufficient. These commitments aim to cut emissions by only about 10 percent by 2035, whereas the UN's Intergovernmental Panel on Climate Change (IPCC) has emphasized the need for a 60 percent reduction from 2019 levels by that year to maintain a strong chance of limiting warming to 1.5 C. He stressed the need for countries to submit more ambitious climate plans ahead of the upcoming COP30 summit in Brazil.

Addressing misinformation, Guterres condemned falsehoods and greenwashing, highlighting the importance of scientific truth in combating climate change. In contrast to former U.S. President Donald Trump’s rejection of climate science and critique of renewable energy, Guterres underscored that renewables accounted for almost all new power capacity in 2024 and represent the most effective path to halting climate destruction.

The World Meteorological Organization (WMO), celebrating its 75th anniversary, is pushing for global coverage of extreme weather early warning systems by 2027. Guterres emphasized that every year in the past decade has been the hottest on record, with rising ocean temperatures damaging ecosystems and no country safe from climate-related disasters such as fires, floods, storms, and heatwaves. He called for countries to increase their climate ambitions significantly to meet the 1.5 C target.

행안부, 공공 AX 책임질 '인공지능정부실' 신설…범정부 DR 체계도 정비

ET News | Local Language | News | Nov. 7, 2025 | Regulation

The Ministry of the Interior and Safety, led by Minister Yoon Ho-joong, announced the establishment of a new 'AI Government Office' to oversee the public sector's transition to artificial intelligence (AI). This office will replace the existing Digital Government Innovation Office, reorganizing its structure into three new bureaus focused on AI government policy, AI services, and AI infrastructure. The AI Infrastructure Bureau will be elevated to oversee public infrastructure safety and cybersecurity at a higher organizational level than before.

In addition to creating the AI Government Office, the ministry plans to revamp the nationwide disaster recovery (DR) system following a recent fire at the National Information Resources Service. The government system rankings will be expanded from four to six levels, enabling prioritization of critical systems and implementation of dual redundancy measures.

Other reforms include accelerating the implementation of a "one-stop administrative service" model, which will proactively provide necessary services to citizens without requiring prior applications. The ministry aims to finalize the strategy this year, begin pilot improvements on complex civil complaints, and complete the organizational restructuring by the end of November.

Minister Yoon emphasized the focus on core tasks, integration of capabilities, and the creation of an execution system capable of delivering tangible results to citizens. The reorganization aims to embed the values of participation, solidarity, and innovation across policies, enhancing public trust in government AI initiatives and contributing to safer, smarter governance.