South Korea in August 2026: the most important developments in economy
South Korea's economy in August 2026 was dominated by the question of how much cash Samsung Electronics and SK Hynix should return to shareholders. On August 6, shareholders of both companies called for larger dividends from their large AI-related cash reserves, and Seoul shares fell more than 4% on technology losses amid lingering concerns about the AI sector. Shares of both chipmakers rallied on August 12. By August 20, Samsung was set to announce a shareholder return programme exceeding $72 billion.
The government and industry also moved on semiconductor supply chains. On August 10, Seoul announced a fund to support domestic makers of chip materials, parts and equipment, as part of efforts to strengthen supply chain resilience. China's CXMT was narrowing the technology gap with SK Hynix and Samsung in smartphone memory chips.
Markets and the wider economy gave mixed signals. Trading in leveraged ETFs fell sharply on August 4 after the government introduced new restrictions, and by August 10 a rotation out of these products accompanied a 30% jump in small-cap stocks. July inflation eased to 2.3% from 2.7% in June, which had been a 30-month high, and the manufacturing PMI rose to 52.4 from 51.4. The Bank of Korea announced plans to buy gold from domestic producers for the first time in over a decade. The economy added 108,000 jobs in July, but the employment rate fell again.
Korean companies also made deals abroad. On August 11, Samsung SDI said it will acquire General Motors' stake in their US battery joint venture, giving it control of the Ultium Cells plants in Ohio and Tennessee; the deal is valued at about $2 billion and is expected to close by early 2027. Hanwha bid to acquire Austal USA, a builder of US Navy ships, and HD Hyundai Heavy won a 956 billion-won deal to supply engine generators in the US. Asiana Airlines shareholders approved a merger with Korean Air. By August 20, South Korea was set to send its first container ship through the Arctic.
by WorldBrief & Maksim Micheliov | AI-generated summary
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