Chey Tae-won, chairman of South Korea’s SK Group and the Korea Chamber of Commerce and Industry, has proposed that South Korea and Japan build an economic community of approximately $6 trillion (about 8,063 trillion won) to form the world’s fourth-largest economic bloc. The vision calls for gradually lowering barriers between the two countries — from joint energy purchasing to connecting power transmission lines and gas pipelines, to liberalizing the movement of people — to jointly respond to protectionism and U.S.-China tensions.
In an interview with Japan’s Asahi Shimbun published on the 8th, Chey said, “If Korea and Japan unite as one, we can form an economic bloc of about $6 trillion, the world’s fourth-largest, securing stronger bargaining power and a greater voice.”
He assessed that while the world effectively functioned as a single market under the past World Trade Organization (WTO) system, supply chains and markets are now fragmenting due to the spread of protectionism and U.S.-China rivalry. With market size itself having become a competitive advantage, South Korea and Japan need to join forces. Chey emphasized, “This lays the foundation not only for accepting international order and rules, but for actively participating in the process of creating them.”
Joint Energy Planning and Expanded People-to-People Exchanges
Energy was identified as the first area of cooperation for the Korea-Japan economic community. With both countries highly dependent on energy imports, jointly designing everything from purchasing to stockpiling to usage could reduce costs by 3-5%, he explained. Chey said, “In the future, we will need to connect power transmission lines so electricity can be flexibly exchanged, or connect gas pipelines.”
He also proposed lowering barriers to the movement of people. The idea is to establish a system allowing South Korean and Japanese citizens to travel freely between the two countries, similar to the European Union’s Schengen Agreement. The Schengen Agreement is a system that guarantees free movement by eliminating border checks between member states in principle.
In the private sector, he cited examples such as financial companies from both countries creating joint funds targeting artificial intelligence (AI) or younger generations, or developing insurance products applicable in both countries. He also saw potential for joint ventures in new industries including healthcare.
The cost burden from low birth rates and aging populations was another reason cited for the economic community. Chey explained, “Both countries are experiencing declining birth rates and aging populations, creating significant cost burdens.” He argued that connecting the Korean and Japanese markets and jointly utilizing key infrastructure and services could lower baseline costs while fostering new industries.
Semiconductor Investment and Japanese Partnerships
Chey also hinted at the possibility of expanded SK Group investment in Japan. He assessed that global semiconductor supply shortages could persist long-term due to the spread of AI, and revealed that the company is reviewing investment locations for expanding production capacity.
Chey said, “SK Hynix has many investment plans within South Korea, but it’s still not enough,” adding, “We are reviewing locations worldwide that have the land, power, talent, and ecosystem to build semiconductor plants.” While he did not disclose specific regions or scale, he added, “A conclusion will be reached soon on which locations to prioritize and how to proceed.”
He characterized the Korea-Japan semiconductor industry as complementary rather than competitive, noting that SK has been continuously exploring AI and semiconductor-related investment and cooperation frameworks with Japanese partners such as NTT and Tokyo Electron.
Position on Past Conflicts and Relations with China
Chey emphasized that the Korea-Japan economic community vision is not a recent idea. He said he began developing the concept following a 2002 lecture to engineering students at Seoul National University, and has been refining it through meetings and discussions with Japanese business organizations for the past six to seven years.
On past Korea-Japan conflicts, he assessed that both countries have learned lessons. Regarding Japan’s export controls on key semiconductor materials to South Korea during the Shinzo Abe administration, he said, “That is now a story of the past that has become largely moot,” adding, “I believe we learned the lesson that retaliating against each other benefits no one.”
He identified younger generations as the driving force behind improving Korea-Japan relations. Chey said, “In the past, there was political animosity on both sides, but favorable perceptions of each other are rising, especially among younger generations.”
He also stressed the necessity of Korea-Japan cooperation in relations with China. While acknowledging China as “a large neighboring country whose presence cannot be ignored,” he said, “I want to emphasize that in terms of distance — not politics — South Korea should be closer to Japan than to China.”
He continued, “Even if Korea and Japan cooperate, it would not reach a scale that surpasses or threatens China,” adding, “If a system is created where Korea and Japan can generate synergies, it would actually create advantages in building relations with China, promote growth, and lower costs.”
Chey also mentioned the need for South Korea to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). He said, “South Korea should join the CPTPP,” while emphasizing that beyond simple membership, both countries should consider the substantive benefits they can gain. His argument is that with the CPTPP’s momentum weakened after the U.S. withdrawal, South Korea and Japan should effectively lead the agreement.