South Korea is increasingly bearing the economic cost of the prolonged Middle East conflict, with rising consumer prices beginning to weigh on household livelihoods even as the country posts record export figures, Finance Minister Koo Yun-cheol said on Friday, 15 May. The minister chaired an emergency meeting of economy-related ministers in Seoul to assess countermeasures against the geopolitical crisis's spillover effects.

What the Finance Minister Said

'While South Korea has shown strong resilience against crises by posting record exports, current account surpluses and stock market indexes, the prolonged war has started to have a visible impact on the real economy and people's livelihoods,' Koo said, according to the Ministry of Finance and Economy.

'The government intends to minimise challenges to people's livelihoods caused by the Middle East crisis while closely monitoring situations at home and abroad,' he added. Koo also expressed gratitude to local fuel retailers for cooperating with the government's fuel price ceiling scheme, noting that market prices currently remain below the cap.

Second-Half Growth Strategy in the Works

The finance minister said the government is drawing up an economic growth strategy for the second half of 2026, with economic security as a central pillar — drawing lessons directly from the Middle East war's disruptions. The strategy will also address the semiconductor industry boom and measures to ease economic polarisation. The plan is expected to be released by the end of June 2026.

Supply Chain and Energy Stability Measures

South Korea, which imports the vast majority of its energy needs, is particularly vulnerable to prolonged instability in the Middle East. The government's fuel price ceiling scheme has so far kept pump prices in check, but officials have signalled a readiness to deploy additional tools if global oil markets tighten further. Notably, this is the second major inter-ministerial review session focused on the crisis's economic fallout in recent weeks.

Real Estate Market Also on the Radar

Koo separately presided over a meeting of real estate-related ministers, where he stressed that a prompt housing supply is the government's top priority for stabilising the property market. 'A prompt supply of housing is more critical than anything else,' he said, adding that the government will work to shorten the approval and delivery process for new homes. Officials also pledged stern action against unfair practices in the real estate market, with relevant regulatory bodies actively monitoring the sector.

With the second-half growth strategy due at the end of June, the coming weeks will test whether Seoul's proactive posture can shield ordinary households from further price pressures as the Middle East crisis shows no signs of resolution.