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Analysis South Korea mobilizes capital as tactical shield to defend won’s 1,500 thresholdTax incentives and pension fund hedging shifts signal a pivot to financial protectionism ahead of 2026 local elections South Korea’s Ministry of Economy and Finance’s (MOEF) announced a new tax package on Wednesday that underscores an all-of-government mobilization toward financial protectionism, as Seoul attempts to break a structural corporate and retail short against the won. This coordinated effort features high-level statements and a targeted tax incentive package designed to address what authorities describe as a structural supply-demand imbalance in the foreign exchange market. Instead of relying on macro-level interest rate adjustments — which the Bank of Korea (BOK) is ill-equipped to deploy— the government has shifted toward a micro-level mobilization of private and institutional capital to keep © Korea Risk Group. All rights reserved. |





