BUSINESS

South Korea's Response to China : South Korea Prepares for China's Strategic Mineral Export Restrictions

South Korea Prepares for China's Strategic Mineral Export Restrictions
Seoul, Feb 5 (NationPress) South Korea's industry ministry announced plans to monitor and respond to potential impacts from China's export restrictions on strategic minerals, which are perceived as a retaliatory measure against recent tariffs by the United States.

Synopsis

On February 5, South Korea's industry ministry announced plans to monitor and respond to potential impacts from China's export restrictions on strategic minerals, seen as retaliation against U.S. tariffs. The government aims to safeguard metal supplies crucial for various industries.

Key Takeaways

  • Seoul to monitor impacts of China's export restrictions.
  • Strategic minerals affected include wolfram, indium, bismuth, tellurium, and molybdenum.
  • China supplies 85% of tungsten and over 90% of molybdenum to South Korea.
  • Collaborative efforts between government and private sector planned.
  • South Korean stocks rose over 1% amid favorable market conditions.

Seoul, Feb 5 (NationPress) The industry ministry of South Korea announced on Wednesday that it will actively monitor and address any potential repercussions stemming from China's export restrictions on vital minerals, which appear to be a retaliatory action against the recent tariffs imposed by the United States.

The Ministry of Trade, Industry and Energy convened a meeting with associated ministries and local businesses to evaluate the metal supply within the nation. This meeting took place just a day after the Chinese government disclosed its intentions to impose at least a 10 percent tariff on American imports, responding to the US tariffs.

In addition, Beijing has announced export controls on items related to five essential Earth metals that are extensively utilized across various industries, particularly in the semiconductor and display sectors, according to reports from Yonhap news agency.

The five critical metals include wolfram, indium, bismuth, tellurium, and molybdenum.

The ministry indicated that Seoul has enough tungsten to last approximately six months and sufficient molybdenum stock to last around three months.

China is pivotal in supplying these materials to South Korea, accounting for 85 percent of tungsten imports and over 90 percent of molybdenum imports as of last year, according to the ministry.

The ministry also mentioned that the government and the private sector will collaborate closely to tackle potential impacts on the economy and any disruptions in the supply of metals resulting from China's actions.

Meanwhile, South Korean stocks closed more than 1 percent higher on Wednesday, mirroring gains seen on Wall Street. The Korean won experienced a significant surge against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) rose by 27.58 points, or 1.11 percent, ending at 2,509.27.

Trade volume was robust at 429 million shares, amounting to 9.7 trillion won ($6.71 billion), with the number of winners exceeding losers at 589 to 300.

Institutions and foreign investors collectively acquired a net 99 billion won worth of local shares, while retail investors divested a net 197 billion won.

Overnight, Wall Street stocks were lifted by reduced concerns regarding trade following U.S. President Donald Trump's announcement to temporarily halt the imposition of tariffs on Canada and Mexico for a month.

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