As geopolitical risks reshape global supply chains, Korea's trading houses are reemerging as vital players in resource security and industrial resilience.
The Posco No. 1 liquefied natural gas (LNG) Terminal in the Gwangyang National Industrial Complex in Geumho-dong, Gwangyang, South Jeolla, is seen in this undated photo. Beyond its parent company's core steel business, Posco International has grown into one of Korea's leading general trading companies, with businesses spanning key raw materials including minerals, grains and liquefied natural gas.POSCO INTERNATIONAL
Shim Jae-hoon
The author is a foreign attorney at Hyemyung Law Firm and adjunct professor at KAIST's Moon Soul Graduate School of Future Strategy.
For a time, it seemed the era of general trading companies had ended. As manufacturers increasingly handled overseas business themselves, their role steadily declined. But strategic rivalry and wars have exposed vulnerabilities in global supply chains, bringing trading companies back as coordinators of raw material procurement and logistics. They have once again become key players in economic security.
This month, the Ministry of Trade, Industry and Energy designated 99 additional professional trading companies, bringing the total to 607. Korea's major trading houses have also improved their performance by expanding into renewable energy, resource development and overseas manufacturing.
During globalization, competitiveness meant buying from the cheapest supplier. Today, it means securing the most reliable supply chain. Resilience has become more important than efficiency.
Japan has responded more aggressively than most countries. Its five largest trading companies, including Mitsubishi Corporation and Mitsui & Co., have evolved into global investment groups focused on energy, minerals, food and infrastructure. The shift reflects Japan's decision to make resource security a national priority.
Under Prime Minister Sanae Takaichi's economic security agenda, these firms have become central policy partners. Government financial support has expanded investment in defense industries, advanced manufacturing and overseas resources, adapting Japan's industrial policy to an era of geopolitical competition.
Japan's trading companies are no longer simple intermediaries. They secure strategic assets while dealing not only in goods but also information, networks, resources and geopolitical influence.
Korea's trading companies are also entering a new growth phase, but they face a clear challenge. They must become strategic investors that secure resources and supply chains. Stable supplies of critical minerals and energy for semiconductors, rechargeable batteries, defense industries and automobiles will require greater investment in overseas resource companies, long-term supply agreements and strategic acquisitions.
Such projects, however, are difficult for private companies to finance alone. Overseas mines and liquefied natural gas projects require enormous capital and long investment horizons, while resource nationalism and geopolitical tensions further increase the risks.
Ultimately, the issue is capital and government support. With more limited financing and investment structures than Japan, Korea cannot expect to move as quickly. Whether trading companies remain viewed as commercial intermediaries or are redefined as key platforms for national economic security will shape future financial, tax and overseas investment policies.
Supply chains are no longer simply about efficiency but about survival. Companies that secure resources protect industry, and countries that support them strengthen manufacturing competitiveness. The revival of general trading companies signals the transition from globalization to an era defined by economic security.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
