The exchange won rate has not stopped falling.The No Japan movement is a campaign to buy domestic products.Nothing will change under the chaebol economy.
2022-02-08
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South Korean Industrial structure vulnerable to exchange rate fluctuations
South Korea's trade dependence on GDP is more than ７０ percent, including the service sector.In other words, domestic demand is low and foreign exchange is directly affected.Even if foreign demand is received, it does not circulate at home and flows abroad.If the person who made the purchase contract increases the dollar by ５% at the time of payment, the payment will increase by ５%.The won-dollar exchange rate is １,２００ won, but it has been hovering around １,２００ won in recent days.
Default due to bulk purchases
In order to maintain international competitiveness, chaebol companies such as SAMSUNG buy parts in bulk and produce them in bulk to reduce costs and sell them at low prices.In this case, large debts are always carried out and large payments are repeated, and problems arise when the value of the currency changes significantly during that period.This is the so-called default.Under these circumstances, the won's international credit rating has not increased, and South Korean companies can trade in dollars depending on the L/C of Japanese commercial banks.
South Korea experienced two foreign exchange crises in １９９７ and ２００８.No country will experience two foreign exchange crises in １０ years.In other words, South Korea's industrial form is vulnerable, and in short, it is trading beyond its currency capabilities.
Considering what Moon Jae In wants to do, the real intention is to socialize, control the currency, and stabilize the value of the won.Do you think the boycott is a campaign to buy domestic goods if it is reversed?
MEMO South Korea is listed by the FRB as a currency manipulator.
Only chaebol companies can grow
The reason why domestic demand is not expanding is the existence of chaebol companies.The role of chaebol companies in driving the Korean economy is important, but on the other hand, investment in chaebol companies is concentrated and other industries are not growing.In addition to the businesses run by chaebol companies, how can Korean companies grow globally?It can only be done with its own money without investment.
The boycott Japan fundamentally solves nothing
This structure will not change even if there is a boycott Japan.As a currency manipulator, even if it leaves the liberal economy, it will not change.It is necessary for the government to take the lead in fostering domestic demand and to attract investment in what industries to foster domestic small and medium-sized enterprises.The boycott Japan does not mean that South Korean domestic companies' sales will increase.
POINT Moon Jae In's term of office is less than three months, and criticism from his country seems to be gathering.I think it's quite late from Japan view.
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With only three days left before the South Korean presidential election, what is the contrast between the two manifestos and Japan - South Korea relations?
The Korean presidential election is only three days away.According to the latest opinion polls, the two seem to be at odds with each other's throats.In the past presidential election, it seems that the dominant candidate in the last poll won the election.Generally speaking, voter turnout is not the only way to go up.If the turnout is low, it will benefit the conservatives as well as the current administration.If voter turnout rises, those who are not usually interested in politics will participate in politics, which will be motivated to change the status quo.
Moon Jae In was working hard on how to get floating votes.This is the minimum wage increase and the feminist movement.And, it succeeded in winning floating votes for young people and women.The result is the worst policy, but the 2022 manifesto shows that there are many contrasting and worrying parts.Lee Jae-myung said, "It includes correcting Moon Jae In's mistakes.Specific industrial investments will create jobs, and urban functions would be dispersed as a countermeasure soaring land prices in Seoul.Yoon Seok-yeol, on the other hand, advocates attracting and increasing investment through the free economy.This is in contrast to industrial investment by large governments and job creation by small governments.
Lee Jae-myeong is pro-China and Yoon Seok-yeol is pro-U.S. in terms of diplomacy and defense.Yoon Seok-yeol mentioned the deployment of additional Saad.This means that the agreement with China will be scrapped.This means that China will confront China, but China is likely to impose economic sanctions on the Korean economy, which is highly dependent on China.Lee Jae-myeong did not mention the relationship with Japan, and Yoon demanded an apology and compensation from Japan.Does this mean that Japan-South Korea relations will be included in the U.S.-Japan relationship, rather than immediately restoring Japan-South Korea relations?In any case, if the right wins, there will be room for future negotiations from the Japanese side.However, relations between Japan and South Korea will end again when they demand an apology and compensation for the Japanese Military comfort woman issue.
No matter which candidate wins, I don't think I can expect much about Japan-South Korea relations.
South Korea violates international law of the sea by not allowing the Japan Maritime Self-Defense Force the right of innocent passage - The Rising Sun flag is a reminder of the past.
The right of innocent passage is a right granted to United Nations member states
South Korea rejects the Japan Maritime Self-Defense Force because of the Rising Sun flag
Violation of China's territorial waters does not fall under innocent passage
Because it reminds me of the past...?
International law of the sea provides ships with the right of innocent passage. Even if ships are within the territorial waters of a coastal state, they may pass without obtaining prior permission from the coastal state, provided that the navigation is not considered harmful as stipulated in Article 19-2 of the United Nations Convention on the Law of the Sea. Thing. In this case, you will need to display the flag of your affiliation. It is a national flag or military ensign.
When considering the Rising Sun flag issue in terms of the meaning of this treaty, South Korea does not recognize the right of innocent passage to the Japanese Maritime Self-Defense Force, even though it has ratified the International Convention on the Law of the Sea. In other words, it is a violation of international law. On the other hand, Japan recognizes the right of innocent passage for Korean ships. The reason is that Japan has ratified the International Convention on the Law of the Sea.
In response to a question in the Diet about the relationship between Chinese ships repeatedly invading territorial waters around the Senkaku Islands and the right of innocent passage, the government decided in June 2021 that this does not constitute innocent passage as recognized under international law. expresses an opinion. The reason for this is that China claims sovereignty over the Senkaku Islands, which are part of Japan's territory, and that violating its territorial waters does not constitute innocent passage, but on the contrary, it is a violation of international law.
Has the South Korean government ever issued an official opinion regarding the Rising Sun flag and the right of innocent passage for Japanese ships, including those of the Japan Maritime Self-Defense Force? It should be released. Saying that you don't like it because it reminds you of the past is no basis for denying the right of innocent passage. This is because there is no such thing in Article 19-2 of the United Nations Convention on the Law of the Sea, which states that navigation is considered harmful.
Masatoshi Muto, a former diplomat, says that making concessions to South Korea is a mistake and that South Korea needs a firm response.
Masatoshi Muto on his dealings with South Korea during his time as a diplomat. He says that he made a mistake by listening to everything and requesting as much as possible.
When asked about the anti-Japanese movement taking place in South Korea, Taro Aso, during his time as Prime Minister, asked, ``Does that have something to do with it?'' Japanese people don't care. As a result, the term ``virtual enemy country'' became popular. The view was that South Korea was conducting an anti-Japanese movement due to domestic circumstances.
There is no doubt that South Korea's current enemy is primarily North Korea. The Korean War is not over yet, and there is currently a ceasefire. When we see public opinion in South Korea calling Japan an enemy country while facing each other across the 38th parallel, we can't help but wonder to what extent South Korea is escaping reality.
When considered within the same framework, China is on the side of South Korea's enemy in the Korean War frame. Until now, the South Korean government has not been able to resolve security issues, and has abandoned its military and continued to focus on Japan, which has not fought back, because if it expressed hostility toward North Korea, China, or the United States, it would immediately take retaliatory measures. It's here. This is to gain the public's attention by saying something powerful. In doing so, it is easy to use stories from the past annexation era. Japan understands this environment and has tacitly tolerated South Korea's anti-Japanese movements.
What we need to clarify is that all of these environments are always real problems for South Korea. It seems that as long as Koreans remain anti-Japanese, they can temporarily feel as if their problems are gone. Even now, when the anti-Japan flag goes up, I forget everything due to a spinal reflex.
[South Korea] If you have the world's highest household debt, you don't have enough disposable income - If you don't spend money, it's just bad manners.
Private/government debt 254%
Household debt is 104.2% of GDP
Global trend of interest rate hikes
Mortgage reduces disposable income
A traveler who just has bad manners
In a statement distributed in advance of the conference, Professor Ham Joon-ho of Yonsei University Graduate School of International Studies, who served as a member of the Bank of Korea's Financial and Monetary Committee, stated, ``Korea's macro leverage (private and government debt) level has expanded to 254% of GDP. ” he pointed out.
The household debt balance has continued to expand for 16 years, reaching a record high of 1,850.9 trillion won (approximately 176.9871 trillion yen) in the April-June 2021 period. According to a study by the Institute of International Finance (IIF), Japan's GDP ratio was 104.2%, the highest among 37 major countries and regions. Incidentally, the countries other than South Korea are followed by Hong Kong (92.0%), the UK (89.4%), and the US (79.2%).
On the 15th, the Federal Reserve Board (FRB), the central bank of the United States, announced the first major interest rate hike in about 30 years. The policy rate will be raised by 0.75% to a range of 1.50 to 1.75%.
Prior to this, South Korea announced that it would raise its policy interest rate from 1.5% to 1.75% in May. The rate was set at 1.5% in April, making this the second consecutive month of interest rate hikes. This will also be a severe blow to those who are burdened with household debt.
South Korea's per capita GDP is approaching that of Japan. According to the 2021 IMF announcement, Japan's price is $39,340 and South Korea's price is $34,801. However, Japan's household debt is around 66-7%.
Housing loans are the largest component of household debt. The skyrocketing price of land in Seoul continues to skyrocket, forcing many to borrow large sums of money to purchase apartments. As a result, even if GDP and wages rise, most of the money goes toward repaying household debts, resulting in less disposable income. I don't have any money to spend.
Even after salaries are paid, the money goes straight through the tunnel and is returned to financial institutions, where it is returned to the market. This is the reality of GDP per capita in the Korean economy.
As the coronavirus pandemic begins to subside and overseas travel is gradually lifted, travel to Japan is expected to become a boom again in South Korea. It's not that they like Japan. The above reasons are largely responsible for why Japan is chosen as a nearby travel destination.
And just because you come to Japan doesn't mean you have to spend money. There are quite a few groups that find faults, point them out, and complain to each other. It is said that Korean tourists just have bad manners.
Representative Yuko Obuchi appeared at the Japan - Korea summit meeting *A wedge telling South Korea not to forget what she said. A meeting and dinner was held between Prime Minister Kishida and President Yun Seok-Yeol, and a press conference was held without a joint statement.
What has been decided is the resumption of shuttle diplomacy and the lifting of restrictions on three strategic items. In reality, the matter falls under the jurisdiction of the Ministry of Foreign Affairs and the Ministry of Economy, Trade and Industry, but the actual content is that the leaders met together to confirm the matter.
Regarding the lifting of restrictions on strategic substances, in reality there will be no major changes in distribution from Japan, and the 2019 restrictions will not reduce or stop exports, so nothing will actually change.
In particular, President Yun Seok-Yeol raised the issue of North Korea and showed South Korea's cooperative attitude toward Japan, but this has only confirmed that this is back on track. This is natural since the North Korea issue is being dealt with through the Japan-U.S. Security Treaty and the U.S.-South Korea Security Treaty.
At the very least, future shuttle diplomacy should ask what South Korea can do for Japan, rather than the diplomatic relations that have been the case in the past, where Japan did something unilaterally.
That's what makes for healthy diplomatic relations. I can't think of anything specific that South Korea has done for Japan. No one is looking for diplomatic relations that involve chatting at the table and asking for wads of money under the table.
The next day, the Japanese media focused on the meeting between Suga, president-elect of the Japan-Korea Parliamentary Federation, and President Yun Seok-yeoul, but what I wanted to draw attention to was the woman in the very edge of the photo.
She is Yuko Obuchi, a lawmaker, and the daughter of former Prime Minister Keizo Obuchi. The reason I wondered why she was in this seat was because I remember her not holding any government-related positions.
What really struck me was the 1998 Japan-Korea Joint Declaration. President Yun Seok-Yeol insists that Japan-Korea relations should return to the Japan-Korea Joint Declaration, but the question is how to return. And Japan complies with all of the Japan-Korea Joint Declaration. Returning would be a problem only for the Korean side.
The points of the 1998 Japan-Korea Joint Declaration are as follows.
Japan-Korea Joint DeclarationHolding of the 2002 FIFA World Cup
Promoting Japan-Korea economic cooperation
Opening of Japanese culture in Korea
Fisheries agreement around Takeshima in accordance with the new United Nations Convention on the Law of the Sea
Response to North Korea issue
The holding of the Japan-Korea World Cup and the influx of Korean Wave content all stemmed from this joint declaration.
The Japan-Korea Joint Declaration was signed by President Kim Dae-jung, but the Japan-Korea World Cup was said to be the worst tournament in FIFA history, and it became unclear whether it was an anti-Japan movement or a soccer tournament.
Less than two years later, the South Korean National Assembly passed a resolution to invalidate this joint declaration. Japanese people must not forget that the area around Takeshima was subsequently filled with Korean fishing boats again, resulting in the current state of Takeshima.
The Japanese representative who concluded this agreement was former Prime Minister Keizo Obuchi. South Korea has completely torn up not only the 1965 Agreement, but also the 1988 Agreement.
Was Representative Yuko Obuchi invited to this meeting as a symbolic icon? In other words, this seems to have driven a wedge that returning to the Japan-South Korea Joint Declaration is the goal of the talks. It's about not forgetting what I said. Does the Korean side actually understand the meaning of this? I don't think they understand.
In conclusion, returning to the Japan-Korea Joint Declaration would be a very high hurdle. This joint declaration was scrapped because of the Takeshima issue. Perhaps the Korean side only understands this declaration as a resumption of cultural exchange.
