This article was independently developed by The Economy editorial team and draws on original analysis published by East Asia Forum. The content has been substantially rewritten, expanded, and reframed for broader context and relevance. All views expressed are solely those of the author and do not represent the official position of East Asia Forum or its contributors.
Universities now channel almost $14 million every hour into public cloud infrastructure, a spending line that already exceeds the combined global budgets for faculty development and student mental health programs. Data centers consume 415 terawatt-hours of electricity annually, a demand curve projected to surpass Japan’s national consumption before 2030. Conventional wisdom treats those figures as the inevitable price of artificial intelligence progress.
This article is based on ideas originally published by VoxEU – Centre for Economic Policy Research (CEPR) and has been independently rewritten and extended by The Economy editorial team. While inspired by the original analysis, the content presented here reflects a broader interpretation and additional commentary. The views expressed do not necessarily represent those of VoxEU or CEPR.
This article is based on ideas originally published by VoxEU – Centre for Economic Policy Research (CEPR) and has been independently rewritten and extended by The Economy editorial team. While inspired by the original analysis, the content presented here reflects a broader interpretation and additional commentary. The views expressed do not necessarily represent those of VoxEU or CEPR.
North Korea Evades Western Sanctions Through Crypto Hacks Pyongyang Trains Elite Cyber Operatives for State-Sponsored Attacks South Korea’s Fragile Cyber Defense: A Ticking Time Bomb?
North Korea is now firmly positioned at the epicenter of global cryptocurrency crime, with more than half of the crypto losses recorded in the first half of 2025 attributed to its cyberattacks. Backed by a state-sponsored training regime for elite hackers, Pyongyang has leveraged its growing cyber capabilities to siphon off digital assets from global exchanges—turning crypto theft into a strategic tool for sanctions evasion. As a result, international actors are racing to implement countermeasures to curb the rogue state's expanding cyber operations.
On June 29, blockchain intelligence firm TRM Labs released its midyear report, “H1 2025 Crypto Hacks and Exploits: A New Record Amid Evolving Threats”, revealing that global crypto thefts totaled $2.1 billion in the first half of the year. A staggering 70% of that—amounting to $1.6 billion—was linked to hacker groups affiliated with North Korea. According to TRM Labs, “North Korea has solidified its position as the most prolific nation-state threat actor in the crypto space,” adding that theft is now “an integral component of state operations.”
North Korean hackers were reportedly behind a series of high-profile breaches this year, further destabilizing the crypto landscape. In February, decentralized exchange Bybit suffered a major breach, losing $1.5 billion in Ethereum and related assets. Wallet provider Safe later disclosed that the attack stemmed from a compromised developer laptop. Both TRM Labs and U.S. authorities identified the notorious Lazarus Group as the primary culprit behind the heist.
Groups like Lazarus typically launder stolen crypto through hard-to-trace decentralized exchanges (DEXs) and mixer services, repeatedly obfuscating the trail before ultimately converting the assets into U.S. dollar-pegged stablecoins like USDT and USDC. This practice enables North Korea to bypass sanctions imposed by the United Nations and the United States, posing a grave international security threat.
This laundering operation thrives in regulatory gray zones. According to media outlets such as The Guardian and BBC, peer-to-peer (P2P) transactions and certain DeFi platforms fall outside the purview of the Financial Action Task Force’s (FATF) “Travel Rule,” which mandates anti-money laundering measures. North Korean operatives and other illicit actors exploit these gaps to establish anonymous, cross-border financial pipelines.
The escalating damage from North Korea’s crypto attacks has spurred a global response. FATF has urged its member states to tighten regulations on virtual asset service providers (VASPs), particularly stressing the urgent need for oversight of stablecoin issuers and DeFi platforms. U.S. agencies, including the Office of Foreign Assets Control (OFAC) and the Department of Justice (DOJ), have begun seizing crypto assets linked to North Korean activities. These agencies have previously sanctioned wallet addresses used by Pyongyang and collaborated with major exchanges to freeze illicit funds.
Despite sanctions and international pressure, North Korea's cyber threat is likely to intensify. The country has steadily expanded its hacking capabilities, now boasting one of the world’s top five hacker contingents—even though only 1% of its population has internet access. This prowess stems from a decades-long state-backed education pipeline.
Gifted students are identified from elementary school and enrolled in elite computer science programs at institutions like Kum Song School. Top performers go on to study at premier STEM universities such as Kim Il-sung University, Kim Chaek University of Technology, and Pyongyang Computer Technology University. Others are channeled into military academies like Kim Il Military University and Moranbong University, where they receive three to five years of advanced cyber warfare training under military and intelligence oversight.
The effectiveness of this system is proven in international competitions. In 2023, a student from Kim Chaek University topped a global hacking challenge hosted by a U.S. tech company with a perfect score of 800, outpacing over 1,700 participants. Students from Kim Il-sung University and other North Korean institutions filled out the rest of the top five. North Korea also dominated the CodeChef programming contests—organized monthly by Indian software firm Directi—winning 18 times between 2013 and 2020, competing against over 20,000 students from 80 countries.
While North Korea has weaponized its cyber talent, South Korea’s cyber defense remains alarmingly underdeveloped. According to the 2025 National Information Security White Paper released by South Korea’s National Intelligence Service (NIS) last month, only 67.1% of government agencies have dedicated cybersecurity departments. More concerningly, over half of those departments are staffed with just four or fewer personnel.
An IT security expert commented, “Compared to North Korea’s offensive capabilities, South Korea’s cyber defense is woefully inadequate,” warning that a comprehensive review of public and private cybersecurity infrastructure is urgently needed.
Massive subsidies and chronic overcapacity fuel a vicious cycle China’s state-led industrial policy hits structural limits Experts warn: “The era of explosive growth is over”
China’s solar industry is teetering on the brink of collapse, hit hard by punitive U.S. tariffs and a severe domestic supply glut. The crisis stems from a growth model heavily reliant on government subsidies, with little regard for technological preparedness. Once a self-proclaimed global leader in green transition, China now finds itself burdened with the consequences of worldwide overproduction—a burden increasingly manifesting in a domino effect of bankruptcies across the sector.
According to the China Photovoltaic Industry Association (CPIA), prices across all segments of the solar panel supply chain have plunged 60–80% from their 2023 peak. Among 121 listed Chinese solar manufacturers, 39 recorded net losses. China’s seven largest module producers together reported combined losses of 27 billion yuan (approximately $3.7 billion) in 2023—their first aggregate loss since comparable data became available in 2017. The downturn continued into Q1 2024, with five leading firms (LONGi, Trina, JA, Jinko, Tongwei) posting combined losses of 8.38 billion yuan (approximately $1.15 billion).
Stock values have plummeted as well. JinkoSolar, the world’s largest solar panel maker, saw its New York-listed shares fall nearly 30% this year, now more than 60% below their 2022 peak. Peers like JA, Tongwei, Trina, LONGi, and GCL have experienced even steeper declines—up to 80% since 2022. More firms are opting for bankruptcy. Market research group SolarBe reports that more than 50 Chinese companies within the solar supply chain have filed for bankruptcy in 2024 alone.
The industry's struggles were on full display at this month’s SNEC PV Power Expo in Shanghai, the sector’s largest trade show. The event shrank noticeably in scale, and CEOs of industry giants LONGi and Tongwei—who delivered keynote speeches last year—did not attend. Yang Liyu, General Manager of GCL Energy Clean Technology, remarked, “There are growing doubts about how deep and prolonged this downturn will be. It hasn’t eased, and it’s already proving deeper and longer than expected.”
Industry experts increasingly argue that China's solar industry has been driven into a profitability crisis by unsustainable overproduction. The nation’s state-led growth strategy—centered on massive subsidies and bulk procurement at fixed prices, regardless of demand—has arguably become a self-defeating model.
According to energy consultancy Wood Mackenzie, China poured an estimated $50 billion in subsidies into its solar sector between 2011 and 2023. These policies helped the country dominate 80% of the global solar supply chain, from raw materials to finished products, and achieve world-class photovoltaic efficiency levels.
Yet the consequences of unchecked overproduction have proven severe. Annual production has consistently exceeded global demand, and by 2023, the gap had nearly doubled. The resulting price crash dealt a heavy blow to profitability: module prices dropped from $0.22 per watt in 2020 to just $0.09 by the end of 2023—a 60% decline. As a result, China’s five leading solar module makers reported combined losses of 13.09 billion yuan (approximately $1.8 billion) by late 2023. In a March industry conference, LONGi Solar Chairman Zhong Baosen admitted that China’s solar industry had entered a “danger zone.”
The impact of China’s overcapacity isn’t limited to its domestic market. Chinese solar firms have been flooding global markets with below-cost exports—so-called “deflationary exports”—undercutting competitors and distorting industrial ecosystems worldwide.
South Korea is among the hardest hit. According to the Ministry of Trade, Industry and Energy, the market share of Chinese solar cells in Korea jumped from 33.5% in 2019 to 74.2% in 2023. During the same period, domestic Korean solar cell share fell from 50.2% to 25.1%. In many cases, even locally assembled modules rely on Chinese cells, leading to criticism that they are merely “domestic in name only.”
The Export-Import Bank of Korea noted in its “H2 2024 Solar Industry Outlook” that Chinese products now dominate the Korean market to such an extent that building solar power plants without them has become nearly impossible.
Industry insiders point to the absence of tariffs on Chinese solar cells as a key factor behind this overreliance. Under the Korea-China Free Trade Agreement signed during the Moon Jae-in administration, Chinese solar exports are exempt from duties. As a result, there is little incentive for developers to use more expensive domestic components when Chinese alternatives are both cheaper and penalty-free.
Meanwhile, the United States has taken drastic action. In May, Washington imposed record-breaking tariffs of up to 3,521% on solar products rerouted through four Southeast Asian countries—alleged backdoors for Chinese exports. The European Union is also preparing similar measures. South Korean industry observers warn that once the U.S. and EU markets are sealed off, China’s discounted solar exports will likely flood Korea even more aggressively.
“Reflecting industry demands amid labor shortages” From Crackdowns to U-Turns to Temporary Permits Shift in tone amid growing concerns over labor shortages in the field
President Donald Trump is reportedly moving forward with a “temporary work permit system” for immigrants employed in specific sectors. This policy shift appears to signal flexibility amid the administration’s otherwise hardline immigration stance, prompted by growing concerns over labor shortages in agriculture and the food service industry.
According to NBC News on June 30 (local time), Trump stated in a Fox News interview, “We are working on issuing a type of temporary permit where immigrants pay taxes and farmers maintain some control.” He continued, “Currently, good people who have worked here for 15 or 20 years are being taken away from farms simply because they may have entered illegally. Farm labor is physically demanding and few others are willing to do it. Removing these workers risks bankrupting farmers.”
“We will do something for farmers and let them make the judgment themselves,” Trump emphasized. “Of course, we won’t be hiring murderers,” he added.
A Department of Homeland Security (DHS) spokesperson reaffirmed this position, following a reversal earlier this month in which the White House retracted a plan to ease immigration enforcement for certain industries. DHS reiterated that “there will be no safe harbor for industries shielding violent criminals or obstructing Immigration and Customs Enforcement (ICE).” The agency underscored that workplace enforcement remains “a key strategy for public safety, national security, and economic stability,” targeting illegal employment networks that “undermine American workers and destabilize the labor market.”
Trump’s latest remarks come in the wake of inconsistent enforcement measures—ICE briefly paused raids on farms, restaurants, and hotels last month, only to resume them shortly thereafter. On June 12, Trump wrote on his social media platform, Truth Social, that “the farm and hotel industries are suffering due to the risk of deportation for long-term skilled workers.” He added, “We must protect farmers. Change is coming.”
In fact, NBC News reported that the administration had temporarily halted enforcement actions in agricultural and hospitality sectors before swiftly reversing course.
Back in April, Trump also stated that he was reviewing ways for undocumented immigrants working on farms and in hotels to remain temporarily, then return legally. At the time, NBC cited administration sources suggesting that Trump was also interested in reforming the H-2A and H-2B visa programs.
This inconsistent approach seems driven by mounting complaints from American businesses employing immigrant labor. The restaurant industry, in particular, heavily depends on immigrant workers. According to the National Restaurant Association (NRA), one in five restaurant workers in the U.S. is a foreign national. While many possess legal work authorization, roughly one million undocumented immigrants are also employed in the sector.
Industry leaders argue that enforcement actions—such as canceling the legal status of thousands of immigrants—have worsened labor shortages. Both documented and undocumented workers are increasingly reluctant to participate in the labor market due to fear of arrest or deportation. “Some employees are too scared to even show up,” said Tony Foreman, who operates five restaurants in Maryland, in an interview with the Financial Times. “There isn’t a growing pool of people willing to do these jobs. It’s becoming harder to find qualified staff.”
The administration’s practice of categorizing immigrants into ‘good’ and ‘bad’ groups based on political convenience has drawn criticism. In an April interview with Fox News, Trump said his administration focuses on deporting “murderers,” while suggesting a “voluntary departure program” for others. “We’ll give them some money and a plane ticket,” he said, “and if they’re good people and we want them back, we’ll try to bring them back quickly.”
His comments reflect the administration’s recognition of America’s dependency on low-wage immigrant labor in agriculture and the service sector. The Associated Press described Trump’s remarks as a departure from his usual hardline stance that casts undocumented immigrants as criminals and promises mass deportations.
However, voluntary departure is a core tenet of Trump’s anti-immigration playbook. According to National Public Radio (NPR), the administration has heavily promoted large-scale deportations, stripped immigrants of temporary legal protections such as Social Security Numbers (SSNs), and emphasized a message of “leave voluntarily, or suffer the consequences.” This strategy aims to instill fear among immigrants that staying could lead to harsh treatment, while suggesting that leaving may allow for a legal return later—a claim many advocates view as manipulative.
The administration has also repurposed a Biden-era immigration app called CBP One—originally designed for pre-entry screening interviews—into “CBP Home,” a platform to facilitate voluntary departure. The advocacy group Immigrant Family Protection Alliance criticized this move, stating, “Immigrants are smart enough to see through the administration’s rhetoric. They won’t take promises of legal return at face value.”
The credibility of Trump’s approach is further undermined by recent actions. The administration insisted on labeling a legally documented Salvadoran immigrant—wrongfully deported due to an administrative error—as a “terrorist and MS-13 gang member,” despite a lack of evidence. Although the U.S. Supreme Court ruled on April 15 that the deported individual, Kilmar Abrego Garcia, had no criminal record and must be returned to the U.S., the Trump administration has ignored the ruling.
On a raw Tuesday morning this past April, two lines of data crossed in a way every curriculum committee should heed. First, Pew reported that 37% of American adults now begin a web search directly inside ChatGPT rather than using Google (Pew Research Center, 2025a). Second, a Vectara/Hugging Face leaderboard quietly showed that even the best model, GPT-4o-mini, still invents facts in 1.7% of answers—and in domain-specific writing, that figure can skyrocket past 40%.
This article was independently developed by The Economy editorial team and draws on original analysis published by East Asia Forum. The content has been substantially rewritten, expanded, and reframed for broader context and relevance. All views expressed are solely those of the author and do not represent the official position of East Asia Forum or its contributors.
This article is based on ideas originally published by VoxEU – Centre for Economic Policy Research (CEPR) and has been independently rewritten and extended by The Economy editorial team. While inspired by the original analysis, the content presented here reflects a broader interpretation and additional commentary. The views expressed do not necessarily represent those of VoxEU or CEPR.
