More Than Four Times the Rate of Positive Responses
Many domestic small and medium-sized enterprises (SMEs) have evaluated their business performance outlook as 'dark' following the inauguration of the second Trump administration. The policy they are most concerned about is the 'universal tariff and strengthened trade regulations.'
On the 24th, the Korea Federation of SMEs (Kbiz) announced the results of the 'Survey of Export SME CEOs on the Inauguration of the Second Trump Administration and Prolonged High Exchange Rates,' revealing that the proportion of respondents who answered their business performance outlook as 'negative' (28.0%) was more than four times higher than those who answered 'positive' (6.4%). The proportion who answered 'no change' was 65.5%.
The reasons for the negative outlook (multiple responses allowed) showed that the highest proportion (61.4%) cited the 'introduction of strengthened trade regulations such as universal basic tariffs.' This was followed by 'maintenance of a strong dollar trend and increased exchange rate volatility' (50.0%), and 'global supply chain instability and rising raw material costs' (38.6%).
When asked what strategies they are preparing in response to the inauguration of the second Trump administration, an overwhelming 89.8% responded 'no special response strategy.' Responses such as 'cost reduction strategies to secure price competitiveness' (5.6%) and 'securing alternative supply chains and strengthening raw material supply management' (2.4%) were in the minority.
The government support policy most desired by domestic SMEs was revealed to be 'expansion of support measures to respond to raw material price fluctuations' (24.2%). There were also calls for 'expanded financial support (policy funds, guarantees, etc.)' (22.4%), 'expanded logistics cost support' (21.0%), and 'expanded tax support (corporate tax, investment tax credits, etc.)' (19.4%).
This survey was conducted from the 10th to the 21st targeting 500 export SMEs.
Choo Moon-gap, head of the Economic Policy Department at Kbiz, said, "The proportion of responses indicating a dark business performance outlook this year after the inauguration of the second Trump administration was four times that of positive responses. It appears that the uncertainty in the export market has increased mainly due to the high tariff policy based on America First principles." He added, "Since nine out of ten export SMEs have no special response strategy to the second Trump administration's tariff policy, it is important to reduce the burden on export SMEs by expanding financial and tax support as well as support for raw materials and logistics costs."
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