K-pop stocks rally as Xi's APEC visit fuels optimism for Korean cultural exports to China
Park Jin-young, left, founder of JYP Entertainment and co-chair of the Presidential Committee on Popular Culture Exchange, speaks with Chinese President Xi Jinping as President Lee Jae Myung looks on during the state dinner for the Korea-China summit in Gyeongju, North Gyeongsang Province, Saturday. Courtesy of Park's Instagram
Entertainment stocks rose sharply on expectations that China may lift its ban on Korean cultural content following Chinese President Xi Jinping’s visit to Korea to attend the Asia-Pacific Economic Cooperation (APEC) meetings held in Gyeongju last week, securities analysts said Monday.
Optimism increased after Park Jin-young, founder of K-pop powerhouse JYP Entertainment and co-chair of the Presidential Committee on Popular Culture Exchange, met with the Chinese leader during the state dinner for the Korea-China summit on Saturday, where Xi reportedly responded positively to the idea of Korean artists performing in Beijing.
JYP Entertainment closed at 85,000 won ($60), up 5.07 percent from the previous session. Shares of other major entertainment firms also advanced, with SM Entertainment rising 1.26 percent and HYBE gaining 0.44 percent.
The KOSPI rose 114.37 points, or 2.78 percent, to close at 4,221.87.
The rally was driven by growing expectations for the resumption of cultural exchanges between Seoul and Beijing and, potentially, an end to Beijing’s ban on Korean cultural content, spurred by the bilateral summit held on the sidelines of the APEC events.
Official restrictions on Korean cultural content were imposed by Beijing in 2016, following Korea’s deployment of the U.S.-led Terminal High Altitude Area Defense (THAAD) system, which China claimed could be used to monitor its missile capabilities. Since then, Korean artists have been largely barred from performing or appearing on television in China.
During the Korea-China summit dinner, Xi spoke positively about Korean performers holding concerts in China, according to Rep. Kim Young-bae of the ruling Democratic Party of Korea.
“During discussions between President Lee Jae Myung, Xi and Park, the Korean side proposed a large-scale K-pop concert in Beijing and Xi responded positively,” Kim wrote on his Facebook account. “This could be a turning point, not only signaling a potential end to the hallyu (Korean wave) ban but also opening the door to broader Korean cultural expansion in China.”
Park also posted on Instagram, “I was truly honored to meet President Xi and have a conversation with him. I sincerely thank him for listening and sharing his kind words. I hope we can continue such exchanges so that the people of both countries can grow closer through popular culture.”
Lee Hwa-jung, an analyst at NH Investment & Securities, said that the discussion of Korea-China cultural exchanges at the summit represents a potential turning point, boosting optimism for future K-pop performances in China.
Lee added that the resumption of K-pop concerts in China is mainly “a matter of timing,” as the Chinese government appears eager to use performances to stimulate domestic consumption and support the local economy.
“As all three major Korean entertainment companies have K-pop artists able to perform in China, the industry as a whole is likely to see positive effects,” Lee said.
Meanwhile, an official at the Presidential Committee on Popular Culture Exchange cautioned that hopes for a full lifting of the hallyu ban “should not be overstated or treated prematurely.”
Nonetheless, the official noted that the summit has strengthened bilateral goodwill, raising expectations for more active cultural exchanges between the two countries in the future.