The era of “$1 trillion in annual trade exports” is within reach for the first time in history. This historic moment was made possible by the dazzling performance of key industries such as semiconductors and automobiles. However, behind the brilliant fireworks of export success looms the deep shadow of the “curse of $1 trillion.” This is because the massive scale of the trade surplus is provoking protectionism among major economies, returning as a boomerang of fierce trade pressure.
The biggest fuse is the United States, which has emerged as South Korea’s largest export destination. According to the Ministry of Trade, Industry and Energy and others on the 15th, South Korea’s trade surplus with the U.S. reached $102.2 billion based on cumulative figures through October this year, surpassing $100 billion for the first time in history. This is the result of an explosive increase in exports of semiconductors, power equipment for data centers, and automobiles, in line with the expansion of U.S. investment in artificial intelligence (AI) infrastructure.
◇ Déjà Vu of Japan’s 1980s Plaza Accord… Only the Means Have Changed
The problem is that this “record surplus” can become poison at the trade negotiation table. The Korea International Trade Association (KITA) diagnosed in reports such as “Analysis of Factors Behind the Expansion of the U.S. Trade Balance” that South Korea’s strong export performance to the U.S. and the deepening trade imbalance will be key variables intensifying future U.S. tariff pressures and demands for local investment. Given that the U.S. political establishment has made reducing the trade deficit a major policy agenda, a surplus exceeding $100 billion could provide justification for making it a top target for invoking Section 232 of the Trade Expansion Act or raising universal tariffs.
This trend of trade pressure evokes the painful history Japan experienced in the 1980s. At that time, Japan swept up a massive trade surplus with the U.S. thanks to its overwhelming competitiveness in automobiles and semiconductors. In response, the United States forced voluntary export restraints on automobiles in 1981 and secured the “Plaza Accord” in 1985 at the Plaza Hotel in New York, which forcibly appreciated the value of the yen. The following year, in 1986, the “U.S.-Japan Semiconductor Agreement” squeezed Japan’s core industries, becoming the spark that led the Japanese economy into a prolonged slump.
A trade expert diagnosed, “The way the U.S. is currently pressuring South Korea has only changed in form from past ‘exchange rates (Plaza Accord)’ to ‘subsidies and tariffs (IRA, CHIPS Act, etc.),’ but the essential logic of trade intervention remains identical to that of 40 years ago.” This means that as long as massive surpluses persist, it is impossible to avoid the structural pressure of South Korea bearing the full cost of U.S.-centered supply chain restructuring.
◇ Global Trade Barriers Rising… Urgent Need for Precise Invoice Management
It is not just the United States. Dissatisfaction with chronic trade deficits has reached a critical point even among Free Trade Agreement (FTA) partner countries. The Korea Institute for International Economic Policy (KIEP) analyzed in studies such as “Trends and Implications of Trump’s Second-Term Semiconductor Export Control Policy” and in-depth research on global supply chain restructuring that “not only the aggressive shift in trade policy by the Trump second-term administration, which prioritizes its own country first, but also industry-specific regulatory barriers targeting our key industries—such as semiconductors, batteries, and automobiles—aimed at responding to this are directly hitting companies across the globe.”
In fact, the European Union (EU) is weighing the introduction of a global safeguard for HYBE Ride Car, while blatantly raising non-tariff barriers through measures such as the Carbon Border Adjustment Mechanism (CBAM) and the Industrial Acceleration Act (IAA).
This is why arguments are emerging that South Korea must move beyond short-term export performance-oriented approaches to avoid a second “curse of Japan.” A “invoice offset” strategy is needed, strategically expanding energy imports such as U.S. crude oil or shale gas so that massive trade surpluses do not become a pretext for trade friction. In addition, alongside simple goods exports, an indirect strategy of direct investment (FDI) must be pursued by establishing production bases locally and creating high-quality employment.
A trade expert emphasized, “At this critical juncture, the government’s sophisticated economic diplomacy and the industry sector’s meticulous shield are more essential than ever to ensure that the historic achievement of $1 trillion in exports does not become a target for concentrated fire in the global trade war.”
in ECONOMY
