Semiconductor Association: Tariff Deal to Boost Business with U.S. Companies

Statement Released Welcoming the Outcome
"Expected to Create Fair Competition Conditions"

The Korea Semiconductor Industry Association on July 31 welcomed the outcome of trade negotiations between South Korea and the United States, which concluded with a mutual tariff rate of 15%. The association stated, "We expect this agreement to play an important role in resolving uncertainties in the semiconductor export environment and in creating fair competition conditions that are not disadvantageous compared to other countries."

On this day, the governments of South Korea and the United States announced the results of negotiations that included lowering the mutual tariff rate from 25% to 15%, conditional on implementing investment plans in the United States. In addition, the United States effectively promised 'most-favored-nation treatment' to the Korean semiconductor industry, which has temporarily eased major concerns within the industry. Most-favored-nation treatment is interpreted as a benefit in which South Korea would be partially exempted from future semiconductor tariffs. However, this is only speculation and is not certain, so caution remains. The detailed negotiation results, including the semiconductor tariffs previously announced by U.S. President Donald Trump, have not been disclosed.

The association noted, "Recently, governments around the world have been fostering artificial intelligence (AI) and semiconductors as national strategic industries and expanding their support policies." It added, "With the full-scale opening of the AI era, the United States is becoming increasingly important as the center of global semiconductor demand and the technology ecosystem." The association also expressed hope that this agreement "will serve as an opportunity to expand business opportunities for both Korean and American companies."

Additionally, the association stated, "The semiconductor industry will use the results of this negotiation as a foundation to strengthen its position in the global market and will strive even harder to fulfill its role as a key national industry."