Trump is back...Korea's Economy Is It a Crisis or an Opportunity?

■ Host: Anchor Yoon Bori, anchor Na Kyung-chul
■ Starring: Lee In-cheol, Director of Economic Research Institute,

* The text below may differ from the actual broadcast content, so please check the broadcast for more accurate information. Please specify [YTN Newswide] when quoting.

[Anchor]
President-elect Trump with America First. Big and small changes are expected in various fields such as financial markets, trade, and energy.

[Anchor]
Lee In-cheol will look forward to the era of Trump 2.0 with the head of the Economic Research Institute. Please come in.

[Anchor]
How are you? The biggest response was the financial market. The U.S. stock market and coins also rose a lot. Why is the market so crazy right now?

[Lee In-cheol]
The second round of the Trump trade has begun. Once Trump was elected, the first thing that moved was the asset market. The dollar is strengthening, and the interest rate on U.S. government bonds is soaring. On top of that, the U.S. stock market has been breaking record highs for three or four consecutive days.

At this very moment, Bitcoin broke through the high point again. It hit 79,000 dollars in dollar terms and 110 million won in won terms. As a result, the Trump administration actually took control of both the House and Senate. The stock market is rising as it leads to expectations of improved corporate performance, especially in the case of virtual assets, as they say they will continue to reduce tax and deregulation.

And I will dismiss Gary Gansler, chairman of the U.S. Securities and Exchange Commission, who has been tightening regulations on virtual assets. At the same time, he mentioned that he would launch a virtual asset advisory committee under the direct control of the president, saying that a regulatory environment in which the industry can develop greatly will be created.

What was the interest was that bitcoin broke through the high point like this, but altcoins were very far away. Then, I was interested in whether it would rise to the level equivalent to Bitcoin, but the stock of Altcoin now is Ethereum. The spot ETF within the U.S. Stock Exchange is trading as it came in second place, and it hit 4.4 million won.

It's going up really fast. In particular, Dogecoin created by Elon Musk has a higher percentage gain. It's going up more than 10% today. As the news of the election was confirmed, it went up 30% all at once. It's a mint coin that doesn't mean anything. It was a coin that I just made for fun. So if I'm rich in Bitcoin,

A person who owns 1,000 Bitcoin is called a whale. It's rich in the 100 billion. As of the end of September, there are more than 670,000 people like this. It's the best ever. Then we have to sell this, and the desire for profit can come out at any time. I can tell you that it's a high-risk, high-return because those who have such large stocks and coins can be profitable at any time.

[Anchor]
The won-dollar exchange rate has also recently hit the 1,400 won range. The strong dollar is showing power, and the exchange rate is a variable in interest rates, but the Fed has lowered interest rates once again. Then, I'm curious about what kind of choice the Bank of Korea will make.

[Lee In-cheol]
The U.S. looks to cut interest rates once more in December, following the big cut, the baby cut. He said that the economic indicators were not bad and that price and employment indicators were balanced. As a result, an environment was created where interest rates could be cut naturally, but the gap between Korea and the United States also narrowed. 1. It has been reduced to 5 percentage points, but the problem is Korea.

Governor Lee Chang-yong is saying that the exchange rate has become a new variable in determining the base rate. Because the won-dollar exchange rate is above the 1,400 won mark even though it is not a crisis during the day. As the Trump trade is rampant, the U.S. continues to release money to stimulate the economy, expel immigrants, and all these factors can stimulate prices.

As a result, due to the high exchange rate, we are gradually pushing back on the timing of interest rate cuts. For this reason, some are suggesting that the Bank of Korea will cut interest rates. What is the point of the practical theory? Get off in August, not that, but the Bank of Korea froze for a year and a half at 3.5% while the U.S. raised interest rates to 9.1% and 5.5% to curb high prices.

Rather, if interest rates were raised a little more at that time, housing prices would not rise much because of low interest rates. And it points out the regret that I could have had the capacity to cut interest rates at a time when I had to lower interest rates like now. Anyway, the Bank of Korea is beleaguered now. It is very difficult to lower interest rates quickly due to the exchange rate.

[Anchor]
Let's take a look at our industrial sector as well. It's Trump's biggest problem. We can't predict what we feel is difficult. But what I've been criticizing over and over again is giving semiconductor subsidies.
has criticized the so-called Chips Act, but do you see the possibility of repealing it?

[Lee In-cheol]
That's right. The United States has already passed the House and Senate. President Biden is also in a hurry now. As President Trump continued to pledge this, he concluded that the Chips Act was a bad deal when he was a candidate, so he had no choice but to erase the Biden administration.

But what's the point of the Chips Act? First of all, in order to establish a semiconductor factory in the United States, I will give you a subsidy tax benefit. However, Korea's Samsung Electronics will invest a whopping $45 billion and 63 trillion won in Texas by 2030.

SK Hynix is also investing 5.5 trillion won in Indiana to build a high-tech package factory, but the Biden administration has already promised nearly 9 trillion won in subsidies for Samsung Electronics and $450 million in subsidies for SK Hynix, which is a postpaid system. It is a postpaid payment after the factory is completed through due diligence.

But how will this change if the Trump administration takes office? Cash, you don't need a subsidy. Because if tariffs are imposed on foreign companies and corporate taxes are lowered for domestic companies, foreign companies will automatically come to the United States and build factories. As a result, the first shovel has already been opened. Our companies are in a state of panic because they are aiming to operate in 2030, but they say they will not feed the fish they caught.

[Anchor]
Semiconductor companies and electric vehicle producers must be very worried, but it was a law that gave subsidies or tax benefits. It has vowed to abolish the so-called IRA. What do you expect?

[Lee In-cheol]
It was August 2022 when the IRA was passed, and we talked about that at the time. Of course, if we build a U.S. factory, use American raw materials, and hire American workers to produce them, we will give them subsidies and tax credits, but we will provide subsidies up to $750 for eco-friendly cars.

For this reason, three domestic battery companies are building 14 battery factories in the United States. At that time, I was very worried about this. Of course, even if it is an investment that cannot be helped to sell goods in the United States, it is true that this investment has increased the U.S. market share while the three domestic battery companies have a global market share of about 20%.

Nevertheless, the Trump administration's pledge to scrap or reduce this investment is also a pledge, so if this happens, we will also have Hyundai-Kia Motors making electric cars. It takes three batteries. So, of course, some of the factories we're investing in directly are mostly in the United States, especially in strong Republican areas, and Elon Musk, CEO of electric vehicles.

And who influenced the Trump administration the most, would you really throw it out? Even if it is discarded, there is a possibility of differentiating between domestic and foreign importers, and especially about subsidies, we are extremely reluctant to give cash, so we are very worried about whether tariffs will rise considerably or with what pretext to bring it down.

[Anchor]
If Trump takes power, I think China is the most afraid. Could Elon Musk be the bridge between the U.S. and China in this situation?

[Lee In-cheol]
In fact, Elon Musk is the biggest beneficiary of the U.S. presidential election. It sponsored 180 billion won, and the stock price increased 3.7 trillion won in asset value in a day. As a result, I'm saying that I'm a super genius. Anyway, it's possible because it's the United States. After all, a Korean car group openly sponsored a presidential candidate and was elected and received preferential treatment? This is a typical political and economic collusion that leads to prison.

Nevertheless, it's possible because it's the United States. So what did Trump say earlier if elected? We will launch a government efficiency committee that recommends reforms to the federal government, and we will appoint Musk as CEO here.

Musk is already posting composite photos as if he will enter the White House. As a result, Tesla shares are soaring on the news. Elon Musk is expected to benefit the most from Trump's return to power, but there are too many businesses led by Elon Musk. First of all, Tesla, an electric vehicle, is operating an AI business, a space business called SpaceX, and a social media X, so these are all regulatory targets of the previous government.

As a result, SpaceX is even talking about national subsidies for global Internet satellites around the world in relation to deregulation related to autonomous driving. On top of that, in the case of social media X, the stock price continues to rise rather than fall as people say that the Musk era is about to come, avoiding punishment related to various regulations.

[Anchor]
Relations with China are also something we need to think about. In fact, exports are an important part, so there are parts that need to maintain relations with China. But what kind of stance should we take when the Trump administration comes to power? This is also a part of concern.

[Lee In-cheol]
That's right. In the meantime, we've been checking against China for high-tech products, so we can't talk about Korea, Taiwan, Japan, and the United States together as an alliance called Chip4. You can't invest. We can't export semiconductor equipment.

With these regulations, we are now leading an alliance to check China as a topic of high-tech industry. If you look at it now, I'm worried about Trump and Yoon Suk Yeol's presidential election congratulatory phone call, we usually congratulate him on his election. Let's meet someday, this is the end of the talk.

But while talking for 12 minutes, I pointed it out and asked him to help me with the shipbuilding industry. So it's a mess on the stock market. I think it is necessary to look into the inside even though the stock market has been in a slump due to double-digit stock prices in the shipbuilding industry.

Of course, benefits are expected. In the case of the shipbuilding industry, there are not many options. It's Korea, Japan, and China, but low-cost container ships are tight in China. It has a market share of more than 60%. As a result, it is said that they are trying to use leverage against Korea, which is best at the declining American shipbuilding industry.

President Trump hates even things. Let's live well in the United States. I don't want the world to live evenly. But the uncomfortable truth is, he has been away from the White House for four years, and Korea is ranked eighth on the top list of the most black people in the U.S. last year. Last year, the trade surplus with the U.S. was $44.4 billion. This is almost over 60 trillion won.

The last year of Trump's first term was 2019. That's $14 billion, four times more. Then, in addition to high-tech products, the shipbuilding industry, the construction industry, the nuclear power plant industry, and the broadcasting industry that China is talking about are all poised to secure fees. What news is actually coming, we just signed a Korea-U.S. nuclear power plant agreement.

Hyundai Engineering & Construction won the Bulgarian nuclear power plant for 20 trillion won, but when I looked inside, Hyundai Engineering & Construction does the work. However, Westinghouse in the United States takes 50% as royalties. Let's take half of the 20 trillion won. So, what's this? Shipbuilding, don't you mean to build a factory in the United States? In fact, Hanwha Ocean took over the shipbuilding company in the United States in June of this year.

So, the United States usually goes to the United States to maintain, repair, and repair U.S. warships because the United States has been enforcing the U.S. law to make them in the United States since the 1920s under the Johnson Act.You have to repair it there with a dragon. So, will this be a benefit? Or are we using a trick to reverse what we owe, excessively, when we've seen a trade surplus with the U.S.? That's what makes me suspect. In any case, I am concerned that we will play a shield against China, which is much stronger than the previous government.

[Anchor]
Anyway, shipbuilders jumped in our stock market, but other than that, they are sad. The U.S. stock market continues to improve, but why is our stock market like this now?

[Lee In-cheol]
That's right. I heard that the 2nd Trump trade in the U.S. stock market was going to cut taxes and release money, so I thought the company's performance would improve, but we're the only exception. Of course, some shipbuilding, defense, and nuclear power plants are rising as benefits are discussed, but overall, we need to raise semiconductors to rise.

The car has to go up and the battery has to go up, but if you look at the policy now, it is foreshadowing a 180-degree change in energy policy. I excluded eco-friendly energy and used the expression "baby deal baby" again. I'm going to mine more fossil fuels again and export them again. That's why I needed a boat.

As a result, this is because most of the representatives of automobiles and secondary batteries, including Samsung Electronics, are sluggish, and there are internal problems. Internally, our economy is not good. It has already grown negative in the second quarter. Negative 0.2%. Zero growth in Q3. The moment Zero falls into negative territory, it's a recession.

As a result, exports on a quarterly basis are good only on a monthly basis because of semiconductors, but exports on a quarterly basis also declined. with the peak of the second quarter As a result, the economy is not good, and the pressure on the second administration can be increased. Then next year's game will be more difficult than this year. The Ministry of Strategy and Finance and the Bank of Korea estimate 2.2% of the Korean economy next year.

[Anchor]
Despite such sluggish conditions, Dubon Korea led by CEO Jongwon Baek, which hit the list last week. But some people say that it ends with Samil Heaven. How do you see the situation?

[Lee In-cheol]
That's right. The restaurant industry is quite unlikely to survive on the stock market. Because external factors. Most restaurant companies have to use imported raw materials. Not only are we very sensitive to climate change as grains are added, but we value coexistence with small and medium-sized franchisees when it comes to franchises.

As a result, the growth rate and operating profit rate are not good. But it's Jongwon Baek's personal talent. It's very famous. I also saw it thanks to a black-and-white chef, but on the first day of listing, Dubon Korea listed on the KOSPI, not on the KOSDAQ, and it was a big hit by more than 50%. At the same time, the asset value jumped very much.

However, the stock price fell more than 10% in three days, and at first, individual buying was introduced due to the Jongwon Baek effect, but on the first day and the second day, foreigners and institutional profit-taking continues. 34,000 won This is also high, and since it goes up, especially when you look at the sales structure and growth potential, 99% of Dubon Korea's sales are domestic businesses.

They say they will go overseas with the listed fund, but to prove their growth potential in the mid- to long-term, they need to diversify their portfolios, expand their overseas sales, and show their franchisees continue to grow together, along with a stable profit structure.

[Anchor]
Finally, let's talk about the delivery app. The delivery platform and the store company created a win-win consultative body. But even though we held the 11th meeting, we failed to negotiate. Submit a new win-win plan by tomorrow, I did this, can I find a point of contact?

[Lee In-cheol]
Since delivery platforms are almost an oligopoly, they charge two fees. The brokerage fee, the brokerage fee that they brokered using their delivery platform, is 9.8% of the food price, and then there is a separate delivery fee. Depending on the distance per case, it's from 1900 to 2900 and 3,400 won.

So, from July 23rd, I asked to discuss co-prosperity with delivery platform companies and store companies, but it took nearly four months, and I met them 11 times, but I'm empty-handed. First of all, the delivery platform and the store's fee cap is 9.8%, which is too high, so let's make a cap of half and 5%. And let's apply it differently. Even when sales are less than 100 million won, you pay 5%? This is a bit too much.

At the same time, they argue that it should not exceed 2-5%, but Baemin and Coupang Eats are the first and second largest companies. It's not accepted while opposing this, so I'm setting a deadline until tomorrow. First of all, the Fair Trade Commission's public interest committee said, "This is an arbitration plan that does not exceed 6.8% as long as it is the middle of the average commission, 5% and 9.8%. And in the case of the bottom 20% of sales, the fee will be lowered by at least 2%. On top of that, the delivery fee level will remain the same, but don't use the expression "free delivery" and then get rid of the demand for Choi Hye treatment. The industry is proposing an arbitration plan, but will these platform companies answer by tomorrow? There's a possibility that you won't be able to do that.

[Anchor]
Let's stop here. So far, Lee In-cheol has been with the head of the Economic Research Institute. Thank you for talking today.