South Korea: Economy

South Korea's financial markets experienced extreme volatility in March, with the KOSPI index plunging over 12% in its worst single-day drop on record, triggering circuit breakers and weakening the won. The sell-off was driven by fears that conflict in the Middle East could cause an energy shock and disrupt supplies, including helium critical for semiconductor manufacturing. A sharp rebound of nearly 10% followed as tensions eased, highlighting the market's sensitivity to geopolitical risks.

In the corporate sector, Samsung Electronics announced a major investment plan of over $70 billion in chip expansion and research by 2026 to strengthen its position in AI chips. Concurrently, the company's unionized workers voted to approve a strike plan, which the union stated could disrupt memory chip supply. Samsung also launched its new Galaxy S26 series and, separately, discontinued its Galaxy Z TriFold phone after a brief three-month market presence.

Other significant developments included SK Hynix initiating a U.S. stock market listing and placing an $8 billion order for advanced equipment from ASML. Externally, QatarEnergy declared force majeure on LNG shipments to South Korea, while the UAE pledged priority crude oil supplies. Domestically, the parliament passed a special bill to invest $350 billion into U.S. strategic industries, fulfilling a prior agreement.