• Journal of Korea Trade
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• v.26 no.3
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• pp.45-62
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• 2022

Purpose - Using unexpected changes in geopolitical tensions on the Korean peninsula as a quasi-natural experimental setting, we examine whether and how geopolitical risks travel across borders through firm-level imports and exports linkages. We also test whether the effects are driven by either imports or exports and assess whether firms can effectively hedge themselves against geopolitical risks. Design/methodology - We focus on a series of unanticipated geopolitical events taken place in Korea in 2018. Making use of the shocks to geopolitical climate, we identify five milestone events toward peace talks. We employ the event studies methodology. We examine heterogenous firm-level stock price reactions around key event dates depending on firms' exposure to geopolitical risks. As a measure of firms' exposure to geopolitical risks in Korea, we utilize a text-based measure of firm-level trade links. When a firm announces and discusses its purchase of inputs from Korea or sales of outputs to Korea in their annual disclosure filings, we define a firm to have a trade relationship with Korea and have exposure to Korean geopolitical risks. Similarly, we use a measure of a firm's hedging policies based on a firm's textual mention of the use of foreign exchange derivatives in their annual disclosure. Findings - We find that U.S. firms that have direct trade links to Korea gained significantly more value when the intensity of geopolitical risks drops compared to firms without such trade links to Korea. The effects are pronounced for firms purchasing inputs from or selling outputs to Korea. We find that the effectiveness of foreign exchange hedging against geopolitical risks is limited. Originality/value - We document the international transmission of geopolitical uncertainty through trade linkages. Export links as well as import links serve as important nexus of transmission of geopolitical risks across borders. Hedging strategies involving foreign-exchanges derivatives do not seem to insulate firms again geopolitical risks. With the recent movements of localization and reshuffling of the global value chain, our results suggest a significant impact of geopolitical risks in Korea on the construction of the global value chain.

• The Journal of Asian Finance, Economics and Business
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• v.10 no.1
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• pp.133-143
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• 2023

The detrimental impacts of financial instability on the world economy during the financial crisis highlighted the requirement to understand the existing financial circumstances. Stability and developments in financial conditions are important for economic prosperity. This study analyses the impact of geopolitical risk on the economic conditions of some specific emerging economies using monthly data from January 1999 to September 2016 by applying a fixed-effects panel data model. The estimation results demonstrated that geopolitical risk has a significant, negative impact on financial conditions. It shows geopolitical risk could be seen as a key factor that contributes towards financial conditions. Further, it implies that negative shocks of high geopolitical risk experienced by emerging economies are one of the primary reasons for the financial conditions' deterioration. The findings provide important insights for governments, policymakers, and investors. For instance, governments and politicians should refrain from expressing or producing tension, economic discomfort, or news that is likely to increase a high geopolitical risk. Maintaining a close eye on geopolitical risk and its sources may also help to stabilize financial conditions and develop a well-functioning financial system. As a result, investors would be better informed about an economy's economic and financial conditions, allowing them to diversify their international portfolios and devise investing strategies during uncertain economic times.

• Journal of Navigation and Port Research
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• v.47 no.4
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• pp.239-245
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• 2023

This study examined the impact of geopolitical risk on port throughput in Korea. With a high trade-to-GDP ratio, Korea has an open economy. The vast majority of its exports and imports are serviced by maritime transport. Therefore, cargo volume of Korean seaports is highly likely to be affected by changes in global economy resulting from escalation in geopolitical risk. In this regard, this study investigated the relationship between geopolitical risk and port throughput in Korea during the period of 1995-2022. Results indicated that the impact of geopolitical risk on port throughput was not statistically significant. However, the relationship varied by export, import, and ports. Especially, it was revealed that cargo volume of Korean ports was negatively associated with the level of geopolitical risk. In addition, it was also found that geopolitical risk had a negative impact on the unit price of Korean import..

• Journal of Navigation and Port Research
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• v.48 no.3
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• pp.206-213
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• 2024

This paper aims to investigate the causal relationship between geopolitical risk and stock price volatility in the shipping industry. Given its international nature and dependence on global trade, this industry is exposed to various uncertainties and risk factors. This study specifically focuses on the impact of geopolitical risk, which has gained significant attention in recent years due to events such as the Russia-Ukraine War and the Israel-Hamas War. To analyze this relationship, the study utilizes vector autoregressive model-based causality tests. The research estimates the causal relationship between geopolitical risk indicators and the stock price volatility of five shipping companies listed on the Korea Exchange. The study covers the period from 2000 to 2023. The results indicate the following: Firstly, an increase in geopolitical risk leads to a rise in stock price volatility for shipping companies. Moreover, the impact of actual geopolitical events, rather than just diplomatic disputes, is statistically significant. Lastly, the impact of geopolitical risk is particularly significant in the bulk shipping sector.

• Strategy21
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• s.38
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• pp.47-82
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• 2015

To control the sphere, it required a strategic understanding to sphere and a power for overcome to it. In the early 20th century, the Pacific-War is a confrontation between the U.S. and the Japan for holding supremacy a pacific ocean sphere, building on maritime geopolitical perception. The Pacific ocean is a large of sphere, so if a country pursues a Pacific region supremacy, it needs a strategic perception and capability to control the sphere. After the U.S. has unified the continental, it has formed geopolitical perception in the Pacific ocean and by the way to control the Pacific ocean selected a naval power. The U.S. must have overcome a Pacific sphere for getting through to the Pacific region, this concept has developed the War Plan Orange(war plan relations with the Japan). Meanwhile, at this point of time, the Japan has recognized to a geopolitical point of view about security environment in the Pacific ocean. like as the U.S. has the War Plan Orange in mind for building on geopolitical perception of the Pacific ocean, the Japan also has learned geopolitical perception from the U.S. Because of this, the Japan has established the Interception-Attrition strategy(war plan relations with the U.S.). If we don't have overcome a sphere of the Pacific ocean, we don't hold hegemony of the Asia-Pacific region. So the analysis of perspective maritime geopolitics about the Pacific war is a meaningful study.

• Journal of Contemporary Eastern Asia
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• v.20 no.2
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• pp.259-277
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• 2021

This article investigates the geopolitics of the energy transition era, concentrating on China's solar photovoltaic (PV) industry. Authors have noted that the rise of renewables is changing the geopolitical landscape of world energy systems, but these new energy sources carry their own technical characteristics and geopolitical implications. Bearing this in mind, this research answers the questions: What are the structural factors that facilitate China's use of renewable energy to achieve political goals, and what are their implications? In order to analyze the data, I devise an analytical framework based on the energy statecraft literature and contrast rival explanations, particularly the "prosumer theory" and the premise of less geopolitical interdependence in a renewable-centered world. I show that asymmetric interdependence in the solar PV sector is already a reality. China's solar PV industry is a case that suffices all conditions (centrality in industrial capacity, market share, and companies' compliance, but to a lesser extent in critical materials and technological endowments) in the solar PV sector to devise effective strategies aimed at reaping benefits out of its asymmetric interdependence with the rest of the world.

• Asian Journal for Public Opinion Research
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• v.11 no.2
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• pp.145-162
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• 2023

This research investigates how users of Bilibili, a video sharing website based in China have responded to carbon neutrality. By conducting quantitative textual analyses on 3,311 comments on Bilibili using LDA topic extraction and content statistics, this research discovers that: (1) Bilibili users have assigned more weight to geopolitical topics (56.3%) than energy (22.0%) and environmental topics (21.7%). (2) When assessing carbon neutrality, Bilibili users considered geopolitical (53.8%) and energy factors (15.8%) more heavily than factors related to the class (9.2%), economy (8.9%), environment (8.7%), and definition (3.6%). (3) More Bilibili users had negative (64.6%) attitudes towards carbon neutrality, with only a small portion of them expressing positive (26.8%) and neutral (8.6%) attitudes. (4) Negative attitudes towards carbon neutrality were mainly driven by geopolitical concerns about the West's approach to China, other countries' free-riding on China's efforts and the West's manipulation of rules, doubts about the feasibility of energy transition and suspicion of capitalists exploiting consumers through this concept. This research highlights the geopolitical concerns behind the environmental attitudes of Chinese people, deepening our understanding to psychological constructs and crisis sensitivity of Chinese people towards environmental issues.

• Journal of the Economic Geographical Society of Korea
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• v.19 no.1
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• pp.143-160
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• 2016

The official development assistance (ODA) accompanies an interstate financial transaction, such as trade, foreign direct investment, and money transfer. ODA policy has designated several purposes. Among them, political purposes have been considered to be the key factors in the regional distribution of foreign aid. If we agree the traditional approach that recognizes ODA as a 'political one', the practice of ODA can be a kind of state geopolitics. This study investigates the construction and characteristics of geopolitical discourses. More specifically, this study pays special attention to the 'practical geopolitics' that is crucial to the policy-making. By analyzing the minutes of the National Assembly Standing Committee, four geopolitical discourses were identified: 'practicing humanities as a developed country', 'providing a role model to developing countries', 'developing new foreign markets' and 'coping with global geopolitics'. These geopolitical discourses have been constructed through the process of justifying the ODA policy to the domestic and international audiences. Constructing discourses on ODA shows the representation of a dichotomous and typical image of developed/developing.

• Transactions of the Korean hydrogen and new energy society
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• v.33 no.5
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• pp.470-498
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• 2022

Recently, the world has been considering hydrogen energy as the primary energy transition means to achieve carbon neutrality by 2050. In order to achieve the goal of reducing greenhouse gas emissions, Korea is also promoting a clean hydrogen economy. However, it is necessary to introduce various clean hydrogen from overseas so that the projected demand can not meet the domestically produced. For this study, we conducted the policy comparison approach between countries other than the generally considered technical and economic approaches. The finding proposes the direction of bilateral cooperation for a strategy of securing overseas clean hydrogen from a geopolitical perspective. Germany was a target country for the policy comparison since it has a high proportion of manufacturing, like Korea, and is taking the lead in the renewable-based energy transition policy. According to the survey and analysis of the policy establishment status and new projects of the two countries, Germany is promoting bilateral international cooperation in the hydrogen area with about 33 countries based on 7 types of activities. In comparison, Korea is involved in bilateral cooperation with about 12 countries on relatively few activities. Among the types of bilateral cooperation, R&D cooperation with advanced countries for hydrogen technology was a common activity type. Germany preemptively promotes cooperation for demonstration and commercialization, considering geopolitical means and strengthening manpower training and assistance on policy and regulation to preoccupy the market for the future. Therefore, it is necessary to consider establishing a network of an entire life cycle of supply and demand network that links the future market with securing clean hydrogen considering the geopolitical distribution. To this end, Korea also needs to expand bilateral cooperation countries by activity type, and it seems necessary to seek various geopolitical-based bilateral cooperation and support measures for developing countries to diversify the supply sources of hydrogen.

• Acta Via Serica
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• v.5 no.1
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• pp.1-22
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• 2020

The paper discusses how the new EU Strategy towards Central Asia issued in May 2019 might be analyzed through the lens of the intensely debated transformations from the liberal to a post-liberal international order. The author claims that the EU's normative power is transforming from the post-Cold War predominantly liberal/ value-based approach, with democracy and human rights at its core, to a set of more technical tools and principles of good governance and effective management of public administration. The paper problematizes a nexus between the dynamics of the EU's nascent post-liberalism and the geopolitical challenges of the EU's growing engagement with illiberal regimes, focuses on direct encounters between the post-liberal EU and the illiberal elites in Central Asia, and seeks to find out the impact of these connections upon the EU's international subjectivity. In this context geopolitical dimensions of EU foreign and security policies, along with the specificity of the EU's geopolitical actorship in Central Asia, are discussed.