Sejin Kim

Korea has entered the global top four economies in innovation, powered by world-class research intensity and corporate R&D. Amid a persistent input–output gap and weak startup M&A activity, the challenge now is scale: converting knowledge into globally competitive firms.

Korea has a choice. It can show the world how to integrate strategy, promotion, and regulation in a way that builds both trust and competitiveness. Or it can serve as a cautionary tale of how regulatory overreach strangles innovation.

By uniting strategy, promotion, and regulation in a single law, South Korea has given itself a powerful instrument to shape AI—but its blunt regulatory mandates threaten to drag down the very strengths that make the act ambitious.

If Korea wants a won stablecoin that matters, give it work on day one: Settle spot ETF trades; connect to tokenized securities (STO); cut remittance costs; and settle cross-border B2B invoices in KRW with fewer hops. Without real uses, the token drifts into speculation.

Korea’s highly educated workforce is increasingly stuck in low-quality jobs. This is not due to a lack of skill, but rather to government policies that penalize growth and fragment markets. Korea must embrace size neutrality, reforming regulations and incentives to support firms that innovate, scale, and compete globally.

In the Trump and China era, South Korea must move beyond export-led growth. Scaling up small firms and boosting productivity in services must be national imperatives.

South Korea stands at a crossroads as its restrictive “positive regulation” and “shadow regulations” stifle innovation in AI, crypto, and mobility tech, allowing China to race ahead. Korea must modernize this framework or risk losing its position as a global innovation leader.

Please join us for this timely discussion on the future of Korea’s competition policy and digital economy.

Watch the high-level discussion presented by ITIF’s Center for Korean Innovation and Competitiveness featuring trade experts, regulatory analysts, and U.S.–Korea watchers from both sides of the Pacific.

At the ITIF-KAIST Joint Forum, a distinguished group of experts confronted the turbulence stemming from the Trump administration’s strategic direction and explore critical questions surrounding technology sovereignty. The discussions also focused on practical pathways to strengthen bilateral cooperation between the US and the Republic of Korea (ROK).

Sejin Kim speaks on how generative AI is unlocking new business models, why the U.S. ecosystem moves so quickly, and how Korea can position itself as a world-class builder of AI-native applications.