At the 2025 APEC Economic Leaders’ Meeting in Gyeongju, Korea, Presidents Lee and Xi signed a series of seven memoranda of understanding (MOUs) covering economic cooperation. Notably, these included agreements on “Silver Economy” cooperation (aging care), joint promotion of an Innovation Startup Partnership Program, and strengthening service trade exchanges. These MOUs – along with discussions at APEC on AI and demographics – provide a fresh framework for Sino-Korean industrial collaboration. This report analyzes sectoral opportunities and challenges in AI, digital trade, aging care (“silver economy”), startups, education, and cultural industries. It offers strategy recommendations for governments and businesses to leverage the new MOUs, and points to investment opportunities that can deepen China–South Korea ties ahead of APEC 2026 in Shenzhen.

Artificial Intelligence and Digital Innovation

Asia-Pacific leaders singled out AI as a key theme at APEC 2025. China’s Xi Jinping called for a global “World Artificial Intelligence Cooperation Organization”, reflecting Beijing’s push to make AI a foundation for growth. For Korea and China, AI presents huge bilateral opportunities. Both economies are investing heavily in AI R&D – Korea’s government has national AI initiatives (e.g. a “National AI Strategy”), and China’s “New Generation AI Plan” continues to drive startups and tech champions. Key AI sectors include advanced manufacturing (smart factories, robotics) and healthcare (AI diagnostics, telemedicine). Integrating AI and digital strategies into innovation ecosystems boosts productivity and spawns new business models. For example, AI can optimize Korean automotive production and improve Chinese healthcare outcomes by processing big data and generating insights.

Opportunities

The MOUs do not explicitly mention AI, but by championing startups and innovation, they create a path for AI collaboration. Korean and Chinese firms can co-develop AI applications (e.g. joint smart-city pilots, AI health platforms for aging populations). Such partnerships – supported by government frameworks – can fuse Korean strengths in robotics and hardware with Chinese leadership in large AI models and data. Academics note that AI-enhanced “Quadruple/Quintuple Helix” innovation ecosystems (involving government, industry, academia, civil society) are vital for growth. A joint Sino-Korean AI innovation hub or lab could channel this model, promoting tech transfer and dual-market products.

Challenges

Both countries face similar hurdles: protecting data privacy, strengthening cybersecurity, and closing AI skills gaps. Realizing AI’s promise requires overcoming “data privacy, cybersecurity, and the need for skilled personnel”. Korean firms must navigate China’s data localization rules, while Chinese firms must comply with Korea’s standards (and vice versa). There is also the broader geopolitical concern of technology decoupling. However, academic and industry partnerships (outside direct government channels) can endure even if state-level tensions rise. Joint training programs (e.g. scholarships for AI education, faculty exchanges) can build the needed talent pool.

Recommendations

Governments should establish bilateral AI research and innovation funds (modeled on the Startup Partnership MOU), and smooth regulatory barriers for joint pilots. For example, fast-tracking visas for AI researchers and aligning intellectual property rules.

Industries should pursue joint ventures in AI-rich sectors. For instance, Korean telecoms and cloud providers might partner with Chinese AI cloud firms to co-develop 5G/AI edge services.

Investment: Venture capital and state innovation funds (e.g. Korea’s TIPS, China’s national tech funds) should be encouraged to co-invest in dual-national AI startups. Conversely, both governments could seed an AI Coalition, akin to a mini APEC forum, to coordinate standards and ethics. This would build on China’s summit proposal and signal joint leadership.

Digital Trade and Services

Digital trade – the exchange of digital goods and services over the internet – is now integral to Korea-China commerce. In 2024 the two-way trade reached $328 billion, and since the 2015 Korea-China FTA it has expanded into emerging fields like cross-border e-commerce and the digital economy. Recognizing this, the leaders signed an MOU “on strengthening cooperation and exchanges in service trade”, effectively covering digital services. Key digital-trade sectors include e-commerce platforms, online financial services, gaming, cloud computing, and media streaming.

Opportunities

E-commerce: Korea’s exports (beauty, fashion, electronics) find a vast Chinese consumer base via platforms like Tmall and JD.com. Chinese e-tailers (e.g. Taobao) can import K-foods and K-pop merchandise.

FinTech and Payment: Korea’s advanced mobile payment systems (e.g. KakaoPay) could integrate with Chinese payment networks (WeChat Pay/Alipay) for seamless cross-border transactions. – Cloud/IT Services: Korean ISPs and cloud providers can offer services (data storage, SaaS) to Chinese businesses, and vice versa. – Digital Content: Korean dramas, K-pop concerts and AR/VR content have major appeal in China; Chinese gaming and animation firms can partner with Korean creators. Indeed, APEC cultural ministers note that digital technologies and AI are widening the audience for creative content.

Challenges

Regulatory and security: China’s Great Firewall and data laws restrict cross-border data flows. Korea’s new Digital Platform Act and privacy rules similarly constrain foreign digital firms.

Competition: Chinese digital giants (Alibaba, Tencent) and Korean giants (Naver, Samsung SDS) may be reluctant to share markets.

Digital Divide: Differences in network standards or content regulation (e.g. censorship) can impede services.

Recommendations

Agreements: Build on the Service-Trade MOU by pushing for a Korea-China Digital Economy Agreement within the FTA framework. This could include common standards for data interoperability, cybersecurity protocols, and mutual recognition of digital signatures.

Industry Initiatives: Joint ventures in platforms, such as a binational e-commerce marketplace for SMEs (similar to Alibaba’s Aeon Mall joint ventures, but Korea-China), would create trust.

Infrastructure: Encourage telecom collaboration (e.g. marine cables, 5G roaming tests) to ensure robust connectivity.

Investment Insight: Investors should eye the booming e-commerce market (Korea’s e-commerce is $230B in 2024). Cross-border payment startups are also ripe for funding, as are cloud services catering to Korean SMEs expanding to China (and vice versa).

Silver Economy (Aging and Elder Care)

Demographic shifts are creating a “silver economy” boom in both countries. South Korea became a “super-aged” society (20% of 65+ in 2025) in record time; China has over 310 million people 60+ (22% of the population) as of 2024. Both governments recognize the urgency: the APEC leaders’ declaration on demographics, and the dedicated MOU on “cooperation in the silver economy sector”.

Opportunities

Healthcare and Assistive Tech: Korea has strong healthcare services and robotics (e.g. robotic exoskeletons for elderly mobility); China leads in AI and affordable care robots. Joint R&D centers can co-develop eldercare devices (for instance, Korean clinical expertise guiding Chinese mass production of robotic helpers).

Digital Health: Telemedicine apps and wearable health monitors have large markets. Korean telehealth startups could enter China via local partnerships, adapting for Chinese language and regulations.

Senior-friendly Consumer Goods: Koreans and Chinese alike spend more on nutrition, lifestyle and leisure. “Care foods” (easy-to-eat nutritious meals) pioneered by Korean companies (CJ, Pulmuone) could be co-marketed in China. Conversely, Chinese companies specializing in senior nutrition and pharmaceuticals can access Korea’s market.

Financial Services: Senior citizens seek financial planning tools and insurance. Cross-border joint ventures in senior insurance products or pension funds could be explored.

Tourism and Culture: China’s growing senior class is interested in travel and culture; Korea can attract Chinese seniors with specialized tours (as with the APEC cultural dialogue urging tourism synergy). Equally, Korea’s seniors can take advantage of China’s visa easing to travel.

Challenges

Regulation: Health and medical devices are tightly regulated. Joint testing/approval mechanisms are needed.

Standards: No common standard for “eldercare robots” yet – though China is leading the way (it has formulated global standards).

Skepticism: Some innovations (e.g. AI caregivers) face cultural barriers.

Workforce: Both countries face nursing shortages. There is risk of poaching talent unless cooperatively managed.

Recommendations

Joint Innovation Programs: Leverage the Silver Economy MOU by creating binational programs (grants or tax breaks) for aging-tech startups. For example, an R&D pilot combining Chinese AI companies with Korean senior-care hospitals.

Industry Clusters: Establish a China–Korea Silver Technology Hub — piloted in Busan (Korea’s aging-care and maritime innovation node) and Tianjin (China’s port-linked smart city with strong Korea cooperation) — where firms can co-locate, test senior-friendly devices, and share care-delivery insights for the 2026 Shenzhen APEC cycle.

Investment: Aging-related sectors are drawing big funding. Chinese silver economy is projected at RMB 19.1 trillion by 2035. Korean investors can co-fund Chinese healthtech startups, and Chinese sovereign funds (like the National SME Development Fund) could invest in Korean senior-care ventures. Public–private partnerships (PPP) in eldercare infrastructure (e.g. smart nursing homes) should be pursued.

Startups and Entrepreneurship

The Innovation Startup Partnership Program MOU (and related economic plan) signals both governments’ intent to foster a connected startup ecosystem. South Korea has a dynamic startup scene (a government “Make Everything” strategy, strong incubators, and global unicorns in AI/fintech), while China’s tech startup ecosystem is vast (from Shenzhen hardware startups to Hangzhou AI firms). Strengthening ties here can yield new ventures and technology diffusion.

Opportunities

Joint Incubators and Accelerators: Create binational startup accelerators (e.g. “Seoul-Shenzhen Startup Lab” or "Seoul-Hangzhou Startup Lab") where young companies spend time in both markets. Korean startups in biotech or apps can tap Chinese mentors and vice versa.

Venture Capital: Encourage cross-border VC. South Korean funds (like Korea Venture Investment Corp.) and Chinese funds (Shenzhen’s venture fund, etc.) could co-invest.

Scaling Markets: Korean startups often hit a ceiling at home; a partnership program can help them scale into China’s 1.4B market under guidance. Likewise, Chinese startups (from electric mobility to edtech) can pilot technologies in Korea’s advanced market.

AI & Tech Transfer: Entrepreneurship in AI and IoT is critical. Embracing digital entrepreneurship accelerates innovation and helps strike a balance between economic growth and social goals. Joint mentorship programs connecting entrepreneurship in universities and industry can amplify this effect.

Challenges

Cultural and Language Barriers: While Shenzhen and Seoul are global cities, smaller startups may struggle with language and business culture differences.

Market Access: Legal barriers remain (weaker IPR protection, censorship, or disputes) that deter small firms.

Competition: Both startup scenes compete for talent and investors. Unaligned regulatory regimes (e.g. data rules, app approvals) hinder portability.

Recommendations

Bilateral Startup Visa: Simplify work visas for entrepreneurs and foreign startup employees, so Korean founders can spend months in China and vice versa.

Innovation Funds: Pool resources in a Korea-China Startup Innovation Fund as a match-making mechanism.

Government–University Collaboration: Fund joint entrepreneurship education and hackathons, pairing Korean and Chinese students on innovation projects for academic entrepreneurship.

Education and Talent Development

Although not tied to a specific MOU, education is a cross-cutting enabler. Both countries seek talent for AI, biotech, and aging-related industries. APEC recognized that training and education programs are needed to address AI’s rapid changes. Korea and China can deepen educational exchange to support their industrial goals.

Opportunities

STEM and AI Curriculum: Develop joint degree or certificate programs in AI, data science, and eldercare engineering. Korean universities (e.g. KAIST, Hanyang) and Chinese universities can offer exchange scholarships or co-branded programs.

Vocational Training: With smart factories and healthcare in demand, vocational training centers (e.g. Samsung Technical School) could partner with Chinese counterparts.

Language and Cultural Training: To support cultural industries and tourism, enhance language exchange (more Korean taught in Chinese schools, and vice versa).

Lifelong Learning: As older populations stay active, e-learning platforms (for seniors) can be co-developed.

Research Collaboration: University partnerships (joint labs, co-publications) in priority fields (AI ethics, gerontology) will build long-term trust. Academic exchanges can persist even amid diplomatic ups-and-downs.

Challenges

Protectionism: Recently some academic fields (e.g. social sciences) have become politicized. Ensuring academic freedom and mutual recognition of credits is important.

Brain Drain: Korea risks losing talent to China’s growing tech sector, and vice versa. Clear career pathways are needed.

Recommendations

Education MoUs: Negotiate agreements for mutual recognition of technical and graduate degrees in priority sectors (AI, healthcare).

Joint Research Grants: Use government science ministries to fund Korea-China joint projects (e.g. under the Global Innovation Index framework).

Skill Programs: Host APEC-themed workshops (e.g. APEC IT Skills Exchange) and funding for SMEs to upskill workers. The AI-Enhanced Academic Entrepreneurship in Education program highlights how AI tools can improve training; piloting such AI-tutoring apps in both countries would be innovative.

Cultural and Creative Economy

The cultural economy – encompassing media, tourism, arts, and design – is a growing focus. APEC’s 2025 Culture and Creative Industries Dialogue highlighted how digital and AI innovation can expand cultural exports and tourism. South Korea’s K-pop, films, and cuisine have global appeal, while China’s film market, gaming industry, and heritage tourism are vast. The Korea–China service trade discussions (related to the FTA) will likely touch on easing restrictions on film, broadcast, and travel services.

Opportunities

Entertainment and Media: Korean dramas and K-pop concerts remain hugely popular in China (and vice versa for Chinese artists). Joint productions (films, webtoons, games) can leverage both markets. For example, co-financing Chinese-Korean movies or animation (as Netflix is already investing in Korean dramas for Chinese audiences).

Digital Content: With AI and VR, there are new forms of creative content (e.g. virtual concerts). The APEC Cultural and Creative Industries (CCI) statement notes AI widens cultural access; Korean VR education content could be localized for Chinese seniors (link to silver economy).

Tourism and Heritage: Increased visa-free travel (China has eased visas for Koreans) and tourism promotion are ripe opportunities. Joint tourism packages for seniors and youth (culture + tech tours) can be developed.

Design and Fashion: Seoul Fashion Week and China Fashion Week could collaborate, and Korean cosmetic brands can jointly research in China.

Challenges

Policy Barriers: After THAAD in 2016, China had unofficial bans on K-pop and films; rebuilding trust is key.

IP and Regulation: Protecting copyrights and avoiding censorship issues requires coordination (e.g. simpler co-production approval processes).

Recommendations

Creative Industry Partnership: Encourage ministries of culture in both countries to launch a Korea-China Creative Industries Forum, to share best practices (e.g. on digital copyright, AI in media).

Market Access: Push for service-trade provisions that cover cultural goods (e.g. quicker approval for film co-productions).

Investment: Incentivize cultural tech startups – for example, funds supporting AI-driven content creation or translation platforms. The APEC statement’s emphasis on inclusivity suggests promoting cultural projects by women or minorities could be a joint goal, tapping into the La Serena Roadmap on inclusive growth.

Strategy Recommendations

For Governments: Align incentives with the new MOUs. Set up inter-agency working groups on AI startups, digital trade, and aging care. Use APEC channels to pilot China–Korea joint initiatives (e.g. under the upcoming APEC 2026 in Shenzhen, propose a theme of “Bilateral Innovation Alliance”). Streamline cross-border investment rules in priority sectors (e.g. allow more joint R&D investment without complex approvals). Enhance visa and tax incentives for collaborative R&D. Maintain high-level dialogue (as agreed) so progress on the MOUs stays on track.

For Industry: Form strategic partnerships across borders. Korean chaebol and Chinese tech giants should co-invest in startups (e.g. a joint AI startup fund). SMEs should be encouraged by government matching programs to explore the partner country’s market (possibly through joint trade fairs). Industries should also collaborate on setting standards – for instance, in AI ethics or eldercare robotics – to reduce future frictions.

Investment Insights

Investors should note the scale and growth potential in these areas:

• AI/Digital: Both governments are pouring billions into AI. Korea’s digital economy was $230B in 2024 with 13% CAGR; China’s digital trade is even larger. Startups focusing on AI-powered healthcare, fintech, and manufacturing automation are ripe for cross-border VC.
• Silver Economy: Korea’s senior-care market is projected to jump (healthcare $55B to $128B by 2030). China’s silver market ($2.68T by 2035) dwarfs all. This growth will attract private equity, especially in biotech, robotics, and care facilities.
• Creative/Digital Services: APEC highlighted the role of the Cultural and Creative Industries (CCI) in job creation. Content platforms, gaming studios, and VR/AR startups can expect heightened investment interest, especially as streaming and tourism recover.
• Cross-Border Funds: Governments might launch bi-lateral funds (like the currency swap cover, though distinct, shows financial cooperation). State funds and pension funds could jointly back infrastructure (smart ports, green transport) that underpins these sectors.

Conclusion

APEC 2025’s outcomes – from formal MOUs to broader innovation dialogues – set the stage for a renewed China–Korea partnership centered on innovation and inclusive growth. By tying the silver economy, startup innovation, and service trade together, both countries acknowledge their complementary strengths: China’s large market and tech scale, and Korea’s advanced R&D and entrepreneurship culture. The strategies above, grounded in recent research on “meta-geopolitical capacities”, stress leveraging non-governmental networks (academia, industry, civil society) to sustain collaboration. As 2026 in Shenzhen approaches, implementing these cooperative initiatives will not only fulfill the Gyeongju agreements but also help both nations climb the value chain together – turning demographic and technological challenges into shared prosperity and innovation-led growth.