Ministry of Foreign Affairs Conveys Concerns Through Multiple Channels Over Exclusion of Korean Electric Cars from US Subsidies

Ministry of Foreign Affairs: "Not Only FTA but Also Potential WTO Violations"

[Image source=Yonhap News]

[Asia Economy Reporter Park Jun-yi] The government announced on the 18th that it has conveyed concerns to the United States regarding the exclusion of Korean companies' electric vehicle models from the beneficiaries of the electric vehicle tax credit under the U.S. 'Inflation Reduction Act.'

An official from the Ministry of Foreign Affairs stated on the same day, "The revision of the electric vehicle subsidy included in the 'Inflation Reduction Act' potentially violates not only the Korea-U.S. Free Trade Agreement (FTA) but also World Trade Organization (WTO) rules. We have reviewed this and conveyed our concerns to the U.S. through multiple channels."

He added, "We plan to continue communicating with relevant ministries and industries to support Korean companies operating in the U.S. to receive non-discriminatory treatment."

The Inflation Reduction Act, signed by U.S. President Joe Biden on the 16th (local time), includes provisions for tax credits of up to $4,000 (approximately 5.24 million KRW) for used electric vehicles and up to $7,500 (approximately 9.83 million KRW) for new electric vehicles that meet certain requirements.