South Korea in May 2026: the most important developments in economy
In May 2026, South Korea's economy was defined by the boom in artificial intelligence chips. Samsung Electronics reported a record quarterly profit, with chip income up 49-fold on the year, and its market value passed $1 trillion on May 6. By the end of the month Samsung and SK Hynix shares had surged again, the KOSPI index stood at a record high, and SK Hynix joined the $1 trillion club. Korea overtook Canada as the world's seventh-largest stock market, and hedge funds recorded their highest weekly buying in a decade across Korean, Japanese and Taiwanese shares, according to Morgan Stanley, while global funds also stepped up their exit from Korean stocks and the won kept falling.
The month's second story was the pay dispute at Samsung Electronics, where workers demanded a bigger share of the chip profits. Talks failed on May 12 and 13, and the presidential office pledged support for dialogue. Samsung changed its top negotiator on May 16 and talks resumed, but on May 20 the union announced a strike starting that Thursday, with about 48,000 workers expected to take part. The Bank of Korea estimated that a strike could cut growth this year by 0.5 percentage points, and the government weighed emergency steps to protect the chip supply chain. Union members then voted on a tentative deal with a performance-based bonus, and on May 27 the union approved the bonus-pay deal for chip workers, averting the strike. Samsung's consumer electronics union had asked a court to block the vote.
Inflation reached a 21-month high in April, and job growth hit a 16-month low. Oil and gas prices and the Hormuz crisis weighed on the outlook: the Korea Development Institute projected that soaring oil prices could add as much as 1.6 percentage points to consumer prices in 2026, South Korea eased refiners' crude stockpiling mandate under an International Energy Agency plan, and it signalled a possible interest rate hike.
by WorldBrief & Maksim Micheliov | AI-generated summary
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