Do what AI and China cannot do
To be more precise, do what AI and China cannot do “YET!”
Spanning back just five years, I was certain that my son and daughter — both rapidly approaching college age — would be best served by anchoring themselves in traditional careers: the qualitative rigor of law or the quantitative precision of engineering, for example. The premise was simple: Mastery in these domains guaranteed a stable, enduring livelihood and good future for them.
That foundational calculus has irrevocably shifted. We now operate in a vice-grip between artificial intelligence (AI) “pushing up” and China “pushing down.” What remains relevant to the rest of us and the global workforce is no longer a fixed target — it is evolving and being radically redefined on virtually a quarterly basis.
Simultaneously, we are further witnessing a deep-rooted, structural shift. While macroeconomic flows have historically oscillated between cycles of consolidation and fragmentation, the market has entered a prolonged phase of corporate "bulkage" of aggressive in-housing and relentless rationalization. Across virtually every sector, the demand for human labor is contracting — a trend running concurrently with and amplified by the dual pressures of technological displacement and cost efficiency.
This is not mere conjecture. It is reflected in broader capital allocation patterns across major global markets. Global corporate dealmaking has seen mega-consolidations (transactions exceeding $10 billion) clear record high-water marks exceeding $1.3 trillion annually, with over half of large-scale deals driven explicitly by defensive market consolidation and synergy extraction. Concurrently, divestitures and corporate carve-outs have surged past $1.6 trillion, as enterprises streamline non-core operations to pull capability back in-house.
Returning to the central theme of my monthly series, I ask, "What does this squeeze mean for the 'Made in Korea' proposition?" More tangibly, how do we preserve and monetize the trajectory of K-beauty, content and broader cultural exports?
If we turn first to cosmetics, the global manufacturing space with true cross-border relevance remains concentrated across five key geographies: the United States, Europe, Japan, China and Korea. While Western and Japanese markets represent mature, highly defensible legacy positions and China aggressively builds indigenous capacity, Korea continues to punch well above its weight.
In a landmark shift, Korea’s cosmetics exports reached a record $11.4 billion, surpassing the United States to become the world's second-largest exporter of beauty products behind France. Crucially, the destination of this volume has pivoted: the U.S. surpassed China as Korea's single largest export market, reaching $2.2 billion and up 15 percent, while shipments to China contracted by nearly 20 percent. This momentum is anchored in three operational advantages:
1. World-class outsourcing dominance: Market leaders like Kolmar and Cosmax Korea —now the top two cosmetics original design manufacturers globally — generate upwards of 2 trillion won ($1.5 billion) annually, providing agile indie brands with rapid speed-to-market and high-spec formulations.
2. Hypersophisticated K-marketing: Driven by social-first customer acquisition models that convert digital engagement into physical retail velocity across global channels like Sephora, Ulta, and Amazon.
3. The premium halo of "Made in Korea": Operating as a seal of formulation quality that competes head-to-head with legacy conglomerates like Estée Lauder and L’Oréal.
It is also worth making a critical distinction in that our current global success is less about enduring, multi-generational loyalty to specific Korean brand names and far more about the strength of "Made in Korea" positioning, powered by agile K-marketing execution. China’s cosmetic ecosystem will inevitably upgrade its quality and perception over time. However, Korea still retains a material, highly actionable time horizon to convert this current global goodwill into scalable, sustainable commercial infrastructure.
Moving on to K-content, when we examine cultural IP through the lens of AI disruption, a fundamental dynamic emerges: AI excels at pattern recognition, genre synthesis and structural templating, but struggles with authentic, high-stakes human emotional resonance.
Korean content exports now exceed $13 billion annually — a figure that surpasses traditional industrial staples like home appliances and display panels. As Korean cinema, series, webtoons and music go mainstream worldwide, their core competitive moat relies precisely on what algorithms cannot easily emulate.
The global appetite for K-content is driven by its raw, hyperspecific portrayal of the human spectrum. Korean narrative structure rarely settles for simple binary tropes of good versus evil; it leans into multilayered emotional textures, with complex jealousy, ancestral grief, socioeconomic friction and unconditional love.
These instincts were forged in the crucible of Korea’s unique modern history. Decades of intense geopolitical volatility, social restructuring and exponential economic growth created a distinct generational experience. This cultural lineage has yielded an intuitive understanding of human vulnerability, societal tension and emotional catharsis that generative models cannot synthesize in a truly resonant, acceptable form. While AI tools will inevitably democratize baseline production and script ideation, Korea’s edge will remain in its willingness to embrace stylistic risk and emotional authenticity over algorithmically safe, homogenized media.
Whether in beauty or narrative, maintaining our global relevance requires more than passive momentum. Korea must aggressively organize and institutionalize its creative and manufacturing ecosystems, reinvesting short-term gains into systemic, long-term defensibility.
If we can build and protect this foundational infrastructure by proactively maximizing our emotionally intelligent, high-speed output on a global scale, we will do more than merely survive the coming shifts. We will remain indispensable leaders, staying ahead of the curve while keeping both AI and China as functional partners rather than existential threats.
Sung Lee is a senior executive at Hyosung Group; former senior adviser at Midas PE, board director at Kakao Games and G2R Group, country CEO of WPP Group, global head of M&A for Ogilvy Worldwide and regional director at Clear Channel; Juris Doctorate from University of Michigan.