▪ The geopolitical importance of Ukraine and the hegemonic competition between the West and Russia for the region.
▪ South Korea’s trade with Russia totaled an estimated $27.34 billion in 2021. Russia is Korea’s 10th largest trading partner, accounting for 2.2% of total trade volume.
▪ Russia and Ukraine are major producers of commodities, such as crude oil, natural gas, and aluminum, and agricultural products, such as wheat and corn.
▪ South Korea depends highly on imports for rare gas used in semiconductor manufacturing, such as neon and krypton.
▪ According to KOTRA, 167 Korean companies operate in Russia.
▪ If the price of crude oil and other global commodities continue to rise due to the economic sanctions against Russia, it will have negative ripple effects on the macro-economy, such as domestic inflation, deterioration of the current account, and an economic slowdown.
▪ In addition to the direct impact as described above, the Korean economy may receive an additional shock if the oil price surge causes a contraction in the global economy.