Lee Chang-yang: "CHIP4 Decision Based on National Interest... Will Not Exclude China"

Minister Lee Chang-yang of the Ministry of Trade, Industry and Energy is delivering opening remarks at the 1st Emergency Economic Ministers' Meeting held on the afternoon of the 19th at the Government Seoul Office in Jongno-gu, Seoul. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Sejong=Reporter Dongwoo Lee] Lee Chang-yang, Minister of Trade, Industry and Energy, stated on the 8th regarding South Korea's participation in the US-led semiconductor supply chain consortium 'Chip 4' that "this is purely a matter to be decided from the perspective of economic national interest" and added, "There is no intention to exclude specific countries such as China or create a closed group."

At a meeting with reporters at the Government Complex Sejong on the same day, Minister Lee said, "China is a large export market with which we must do business together, so there is ample room for cooperation in various industrial sectors."

He further stated, "China is a large export market and a market with which we will have to do business for a considerable period going forward," adding, "From a strategic perspective, we will carefully coordinate in the best way possible by considering the development of the semiconductor industry and the overall economy."

Regarding the possibility of diplomatic retaliation from China related to Chip 4 participation, he explained, "The possibility (of China's retaliation) will vary depending on the content, level, and method of Chip 4," and added, "We plan to present our own opinions on the desirable direction at the preparatory meeting." The government plans to participate in the Chip 4 preparatory meeting, which includes South Korea, the United States, Japan, and Taiwan, but the schedule and location of the meeting have not yet been finalized.

Regarding concerns that Japan's export restrictions could be an obstacle to Chip 4 participation, Minister Lee said, "I do not think the Chip 4 mechanism presupposes the resolution of bilateral export restrictions with Japan," and explained, "I hope that the issues will be naturally resolved in the process of improving economic and non-economic relations with Japan."

[Image source=Yonhap News]

Additionally, Minister Lee emphasized that there are plans to stockpile gas without problems this winter amid concerns about gas supply and demand during the winter season. He said, "Gas has been continuously and stably stockpiled," and emphasized, "The Ministry of Trade, Industry and Energy is the first to monitor and discuss gas and electricity supply and demand among the areas we focus on the most."

Regarding the progress of nuclear power plant exports, he explained, "Since June, some progress has been sequentially made," and added, "Once the Prime Minister's directive is issued on the 11th, we will form a nuclear power export strategy task force and approach the global market starting with the Czech Republic and Poland."

Minister Lee clearly expressed a negative stance on the imposition of windfall taxes on the refining industry due to high oil prices. He stated, "Although refiners have made significant profits, there were times about one to two years ago when they incurred losses close to 5 trillion won," and argued, "Since this is a globally open market where exports and imports are conducted according to international prices, unless it is a public enterprise or government-related company, I think it is necessary to be cautious about collecting windfall taxes just because profits were high."

He also showed a negative stance on additional electricity rate hikes beyond the scheduled base fuel cost increase in October. Minister Lee said, "Since inflation is already very high and people's livelihoods are difficult, I think the rate increase should be minimized," and added, "If possible, price stability should be maintained."

Meanwhile, Minister Lee plans to sequentially release industry-specific strategies such as display, battery, shipbuilding, and robotics following the disclosure of the automobile industry strategy roadmap as early as the end of this month.