Government to Reduce Tariffs on All Naphtha Imports to 0% by Year-End

"Alleviating Burdens in the Petrochemical Industry"

The government will apply zero tariffs on all naphtha imports and 100 million barrels of crude oil used for naphtha production until the end of the year.

On the 6th, the Ministry of Economy and Finance announced, "At the Cabinet meeting on July 3rd, it was decided to reduce the tariff rates on naphtha and crude oil used for naphtha production starting from today to enhance the competitiveness of the petrochemical industry and stabilize the prices of daily necessities."

Currently, a tariff rate of 0.5% is applied to naphtha used in the manufacture of synthetic fibers, rubber, plastics, and crude oil used for naphtha production.

The Ministry explained, "Since South Korea does not produce oil, it imports manufactured naphtha or imports crude oil to produce naphtha. Recently, due to the prolonged Russia-Ukraine war, disruptions have occurred in the relatively inexpensive Russian imports, significantly increasing the cost burden on companies."

It added, "Competitor countries in the petrochemical sector such as China, India, and Middle Eastern countries have recently greatly expanded their production facilities, threatening the export competitiveness of our companies. Considering these circumstances comprehensively, it was decided to reduce the tariff rates on naphtha and crude oil used for naphtha production."