Korea to implement $68 bil. market stabilization program amid Trump tariff fallout
Kim Byoung-hwan, center, chairman of the Financial Services Commission (FSC), speaks during a financial market assessment meeting at Government Complex Seoul, Monday. FSC Vice Chairman Kim So-young is seen, left, and Financial Supervisory Service Gov. Lee Bok-hyun at right. Yonhap
The government will thoroughly prepare a 100 trillion won ($68 billion) market stabilization program to ensure that liquidity is available at any time, in response to growing market uncertainty caused by U.S. President Donald Trump’s tariff policies, financial authorities said Monday.
It will also ensure that previously announced and ongoing policies are carried out as planned to reinforce market confidence, they said.
“The government is planning and will execute a market support program totaling 100 trillion won to ensure that necessary measures, including liquidity support, can be taken at any time depending on market conditions,” Kim Byoung-hwan, chairman of the Financial Services Commission (FSC), said during a financial market assessment meeting.
The meeting was attended by Financial Supervisory Service Gov. Lee Bok-hyun, along with the chairmen of the country’s top five financial holding groups — KB Kookmin, Shinhan, Hana, Woori and NH NongHyup — as well as the heads of relevant institutions, including the Korea Financial Investment Association and the Korea Exchange.
The country's top financial regulator said that the Trump administration’s recent imposition of "reciprocal" tariffs has heightened uncertainty across economies, industries and financial markets both domestically and internationally.
Last week, Trump announced plans to impose a minimum 10 percent baseline tariff on all imports to the United States, along with country-specific reciprocal tariffs that primarily target Asian countries. Vietnam faces the highest rate at 46 percent, while Korea is subject to a 25 percent tariff.
These reciprocal tariffs are dealing a significant blow to key domestic industries such as semiconductors, cars and steel.
U.S. President Donald Trump holds the "Foreign Trade Barriers" document as he delivers remarks on tariffs in the Rose Garden at the White House in Washington, April 2. Reuters-Yonhap
Kim voiced concerns that the tariffs may lead to deteriorating conditions for both export-driven businesses and their supply chain partners. He also emphasized the importance of maintaining stable management of the economy and financial markets over the remaining two months before the next administration takes office, following the Constitutional Court’s ruling last Friday to remove President Yoon Suk Yeol from office.
“In times like these, it is essential for the financial sector to carry out its fundamental role in safeguarding market stability and ensuring the seamless flow of financial intermediation,” Kim said. “I urge the sector to stay vigilant and responsive so that stability is maintained in the financial markets and timely financial support reaches the real economy, particularly businesses impacted by the reciprocal tariffs.”
In addition to the 100 trillion won market stabilization program, the government will also accelerate efforts to establish a 50 trillion won fund aimed at responding to the trade war and supporting the country’s long-term economic growth.
This fund is intended to support companies in advanced strategic industries such as semiconductors, secondary batteries, biotechnology, artificial intelligence and robotics.