▲ 2020 U.S.A.`s Presidential Election

Starting Presidential Election in the U.S.A. on November 3rd, Tuesday, Joe Biden is expected to be elected as a 46th American President according to the count of votes. Depending on who would be a new president of the U.S., the economical effect on South Korea will also change because South Korea and America have a very close relationship with a meaningful history.

▲ Joe Biden (Joseph Robinette Biden Jr.)

Biden's inauguration as the 46th president of the U.S. is expected to help Korean companies export more in the long run than in the Trump era, but in the short term, exports to the U.S. tend to bring degrowth right after the U.S. presidential election, according to a report.

The Hyundai Research Institute analyzed that Biden's victory is more helpful for Korean exports through a report titled "The Impact of U.S. Presidential Election Results on the Korean Economy". Based on Moody's prediction, it estimated the impact on the Korean economy by considering the interrelation between the Korean economy and the U.S. economy and found that the pressure on Korea's economic growth rate to rise further when Biden was elected.

On the other hand, in the short term, Korea's exports to the U.S. and direct U.S. investment into Korea tend to decline in the following year following after the past U.S. presidential election. According to the Federation of Korean Industries (FKI), the average growth rate of exports in the following year after the past U.S. presidential election was –4.2 percent. It was pointed out that we must do our best to support the major export industries to the U.S.A.

No one knows certainly what will occur next. Therefore, to make Biden's election into a positive effect on South Korea, our nation must keep a careful eye on situations after this election.

November 15th, 2020

by Kim Hyeon