Ministry of Trade Industry and Resources

On the first anniversary of the launch of the People’s Sovereignty Government, the Ministry of Trade, Industry and Resources (MOTIR, Minister JK Kim) reviewed its policy record over the past year and presented five key achievements.

The past year was marked by overlapping crises. Global trade uncertainty and risks to energy and resource supplies from the Middle East weighed on the real economy; global oversupply put key industries, including petrochemicals, under pressure to restructure; and competition for global industrial leadership intensified around AI.

MOTIR managed these risks closely while moving decisively to capture future growth opportunities. In November 2025, Korea concluded the Korea–U.S. tariff deal after months of sustained negotiations guided by a clear national-interest-first principle, reducing uncertainty for exporters. The agreement eased tariff burdens on key U.S.-bound exports, including automobiles and pharmaceuticals, and secured semiconductor treatment no less favorable than that of major competitors. Korea also laid the groundwork for strategic industry cooperation with the United States through the Korea–U.S. Strategic Investment MOU, Korea–U.S. shipbuilding cooperation under MASGA, and the Special Act on U.S.-Bound Investment.

For the petrochemical industry, MOTIR moved early to restructure the sector and prevent its difficulties from spreading to regional economies. The ministry approved the first restructuring project between HD Hyundai Chemical and Lotte Chemical in Daesan and backed its implementation with more than KRW 2.1 trillion in financing, tax incentives, and regulatory streamlining. The Special Act on Strengthening and Supporting the Competitiveness of the Petrochemical Industry also created a legal basis for restructuring and a shift toward higher-value products.

Following the outbreak of the war in the Middle East, the government and industry activated a coordinated public-private response to stabilize supplies of crude oil, naphtha, and other key materials, minimizing disruption to the real economy and people’s daily lives. By May 2026, Korea had secured crude oil and naphtha imports at around 90 percent of the 2025 level, reduced the share of Middle Eastern crude in total crude imports from 70 percent to around 50 percent, and helped restore petrochemical operating rates to about 75 percent.

Despite trade and Middle East-related risks, Korea stepped up export support, with exports reaching a record USD 709.3 billion in 2025. Korea became the sixth country in the world to surpass $700 billion in annual exports. Exports have remained on an upward path in 2026, reaching a record $306.5 billion through April, up 40.9 percent year-on-year, putting Korea’s first entry into the world’s top five exporters increasingly within reach. Korea also broadened its export base through emerging-market diversification, growth in K-consumer goods exports, win-win trade finance, preferential loans for exporters, and the launch of K-Export Star 500. Foreign direct investment reached a record $36.1 billion in 2025.

Finally, MOTIR began accelerating AI transformation in manufacturing. The ministry launched the Manufacturing AI Transformation (M.AX) Alliance to drive change across Korea’s manufacturing ecosystem. Within about eight months, participation grew to around 1,500 companies and institutions. In 2026, MOTIR will promote 100 new AI factories by applying AI to manufacturing processes in 12 key industries, including semiconductors and shipbuilding, and plans to deploy more than 200 by year-end. The ministry is also expanding AX across processes, products, and regions by operating the Industrial Complex AX Division, linking 10 AX demonstration industrial complexes with regional universities, and developing technologies and core components for AX products such as autonomous vehicles and humanoids.