US Secretary of State: "Inflation Reduction Act Expands Economic Opportunities"

[Image source=EPA Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] U.S. Secretary of State Tony Blinken emphasized the necessity of the Inflation Reduction Act (IRA), which provides subsidies exclusively for North American-made electric vehicles, on the 30th (local time), stating that it will expand economic opportunities.

After a meeting with Canadian Foreign Minister Melanie Joly, Secretary Blinken highlighted the importance of economic cooperation between the two countries during a joint press conference, saying, "The Inflation Reduction Act will be one way to achieve that."

He emphasized, "The Inflation Reduction Act supports more than $368 billion in clean energy technologies such as electric vehicles and batteries produced in North America," calling it "the largest and most ambitious climate change investment in history." He also evaluated that it "will deepen economic ties and expand economic opportunities for our people."

Due to the Inflation Reduction Act limiting subsidies to North American-made electric vehicles, the Korean automotive industry is inevitably facing immediate shocks. The Korean government has already conveyed its concerns to the U.S. administration multiple times, including through delegations visiting the U.S. The government views such discrimination as highly likely to violate the principles of national treatment and most-favored-nation treatment under the Korea-U.S. Free Trade Agreement (FTA) and the World Trade Organization (WTO).

In this regard, U.S. Vice President Kamala Harris, during her visit to Korea on the 29th, met with President Yoon Suk-yeol and responded that President Joe Biden is well aware of Korea's concerns, stating, "We will carefully ensure that ways to address Korea's concerns during the law enforcement process are prepared."

Meanwhile, Secretary Blinken also mentioned the so-called 'guardrail' provision included in the Semiconductor Support Act during the talks, which prohibits companies receiving U.S. government subsidies from investing in advanced facilities at Chinese factories for the next ten years. He asserted, "The Semiconductor Support Act will enhance semiconductor supply resilience in the North American region."