Donald Trump’s tariffs appear to be benefitting an unexpected industry: K-Pop

When US president Donald Trump imposed a 25% tariff on foreign steel earlier this month, it was done with the stated aim of boosting the US’s domestic economy, but the move appears to be having the unintended consequence of boosting South Korea’s turbulent pop industry.

As reported by The Guardian and Korea Times, shares in the country’s four major K-Pop companies – SM, YG, HYBE and JYP Entertainment – have hit 52-week highs in the past few days, which analysts suggest is fuelled by investors seeing the K-Pop industry as a safe bet amidst the threat of a looming trade war.

To put it in somewhat over-simplified terms, tariffs affect the import and export of material goods, making them a potentially risky investment right now, but they don’t affect industries like entertainment. To point out a rather obvious fact, you don’t need steel to construct a K-Pop band.

There are a few other factors at play too. The K-Pop industry is recovering from a year of weak performance caused by a variety of factors including the forced hiatus of boy band BTS, whilst its members fulfilled their military service, and contract wrangling surrounding the members of girl group Blackpink.

“The entertainment sector stands to gain significantly from the return of major IPs like BTS and Blackpink, as well as minimal impact from US tariffs,” Shinhan Investment and Securities researcher Ji In-hae told the Korea Times.

There are also signs of renewed cultural ties between South Korea and China, the latter of which has recently relaxed visa rules for South Korean visitors.

South Korea's economy is heavily reliant on exports, and products such as semi-conductors and vehicles are likely to be hit hard by US tariffs. K-Pop remains one of South Korea’s most important cultural exports, generating more than $900m in 2023, a rise of over a third year-on-year, according to the Korea Culture and Tourism Institute.