EPEX every 1 variety in MBC “Weekly Idol” at MBC Dream Center on April 23, 2024, in Goyang, South Korea.
MBCPLUS | Imazin | Getty images
Struggling with a closed and weak domestic consumption in a trade war with the United States, China is set to make a U-turn on an unexpected region: C-Pop.
It was announced April 28 K-Pop Group EPEX Will perform in Phuzou, Fujian, Province on 31 May – first time An all-korean statue group Since 2016, a concert has been organized in the mainland China.
At its top, large-scale annual dream concert-south is Korea’s longest-lasting C-Pop event. Allegedly determined The Korea Entertainment Producers Association said on 30 April that for the 40,000 -seat stadium in the province to be held on 26 September.
Those developments may indicate the deployment of Terminal High Altitude Air Defense Missile Defense System in 2016 with South Korea, indicating reducing China’s informal ban on cavities on the mainland. Saying that the purpose of the system was to disrupt China’s power in the regionBetween other reasons.
According to CGS International Securities Hong Kong’s Research Analyst Oh Jivu, the K-Pop represents the “structural twist” for the Chahra sector.
Oh told CNBC “This policy change is part of China’s broad strategy to revive domestic demand amidst China’s widespread consumption.”
He said that China’s GDP growth in 2018 contributed to about 70%, but in recent years the share has come down by 30%, the country’s consumer price index is hovering near zero.
He said, “In response, the government has started promoting cultural events – including foreign pop concerts – to encourage the discretionary expenditure in tourism, hospitality and local commerce,” he said.
On 25 April, the Ministry of Culture and Tourism of China issued a notice to promote cultural programs, Including concerts and concerts.
Oh said that China is the third largest album export market in South Korea after Japan and America, and Second largest music market in Asia“Despite the years of restrictions, underlining its strategic importance.”
Tariff-proof sector
Helping the case for K-Pop in China is the fact that the region is seen as a tariff-proof.
Shinhan Securities’s G In-Haye noted on 14 April that “although the market is very unstable due to tariffs, (entertainment and media) are not affected by tariffs, while China’s possibility of opening is valid.”
CGS’s Oh said, “Core revenue drivers-streaming, concerts and fans are content-digital and abstract, causing immune to cross-border tariffs.” Even if fan buys albums and goods, the tariff exposure is “negligible”, given the price of low unit and demand of loyal fan.
“Unlike semiconductor or auto, where the global trade policy directly affects supply and pricing, the consumption of the c-pap is very less sensitive to conservationist measures,” he said. The semiconductor and automobiles are two of South Korea’s two major exports.
Last month, South Korea announced $ 23 billion support package For its semiconductor area in light of uncertainty around the American tariff. The Trump administration has imposed 25% levy on all vehicles sent to the United States, and one and 25% on steel and aluminum imports.
Are among Hyundai and Kia of South Korea Top eight bestsailing brand In the US, car marketplace according to Carpro. Country is also Steel’s fourth largest exporter for America In 2024, according to the International Trade Administration under the US Department of Commerce.
Diplomacy
Analysts say there is a diplomatic dimension in China’s soft trend on K-Pop which is beyond the desire to increase domestic consumption.
City analysts John Wu and Alicia Yap said in April 1 that China may try to restore relations with neighboring countries including South Korea, including South Korea, in the light of its economic challenges.
South Korean Girl Group members twice at the 2018 Amate Asian Music Awards at Asia World Expo on December 14, 2018 in Hong Kong.
VCG | View China Group | Getty images
Cultural diplomacy can emerge as an important early point, said, leading to reduce informal restrictions on South Korean materials and resume fan-driven revenue currents of K-Pop in the region. The region has been described by them as a long -term beneficiary of the changing world system.
Oh of the CGS, which tells the CNBC, states that “the revival of K-POP can help to diversify cultural offerings and promote regional goodwill.”
He said that China appears to have warm relations with South Korea keeping temporary borders on some Western materials including Hollywood films.
Oh said that the shift not only restores access to the already banned fan economy, but also offers an opportunity to deepen cultural engagement in Asia, which will work for long -term structural development in the region.
Catalyst for K-Pop shares
Development can be good news for K-Pop stocks.
The earnings of the four largest companies of K-Pop and the share price-known as “Big Four” and all are listed publicly- A beating In 2024. This is despite this Giants for fans, multi-city concerts and billions of YouTube currents It was seen worldwide.
But in the first few months of 2025, there is a reversal, out of which three big companies grow adequately from year to year.
China’s concert market will greatly boost in 2025, should the country impose informal ban on South Korean artists. Joshua Kim of CGS wrote on February 10 that the size of the Chinese concert market increased from $ 2.9 billion to $ $ 8 billion in 2024, with 189% increase during this period.
“Therefore, if China banns the Korean artists, we hope that China is responsible for more than 25% concert revenue in 2025, more than the contribution in 2016,” he said.
Morgon Stanley Equity Analyst Seyon Park said it would consider reopening a “potentially powerful catalyst” to a China that could significantly increase the earnings and fair price estimates, although the possibility of re -opening is likely to be gradual.
In OH’s view, approval for EPEX’s concert is a “policy test case” that can pave the way for large acts. He said that twice can indicate small fan events by girl groups and IVE in Shanghai that China is starting with mid -level acts, before progressing widely for re -involvement.
Seoul, South Korea – February 03: Ive Ive’s 3 mini album ‘Ive Sympathy’ at the press conference at the Conrad Seoul at the Yeongdeungpo -Gu on 03 February 2025 in Seoul, South Korea. (Photo by Chosunilbo JNS/IMAZINS through Getty Image)
Chosunilbo JNS | Imazin | Getty images
The EPEX industry has a relatively crook group, debuted in 2021, but Oh said that these are not isolated, instead, they are a widespread infection towards high-capacity, high-visible events.
“Hybe, JYP, SM, and YG have already been deployed to visit the global region, we hope that the Korean agencies will once quickly move forward in meeting the demand to lift the restrictions completely.
Or for quotes 2009 song From 2ne1 of YG Entertainment, K-Pop is telling China, “This is a long time coming, but now we are here.”
