Profit-Sharing Structure Needed for Sustainable Bilateral Benefits
Urgent Need for 'Exclusive Visas' or Expedited Review System
As tariff negotiations show signs of prolongation due to mounting trade pressure from the United States, experts have suggested the need to propose a job and supply chain-linked profit-sharing model. While both sides are clashing over how to divide the profits from investments in the U.S., experts emphasize that a mutually beneficial solution is necessary to achieve sustainable results.
The Korea Chamber of Commerce and Industry and the Korea-US Association held a seminar titled "Win-Win Strategies for Korea-US Industrial Cooperation after Tariff Negotiations" at the Chamber of Commerce building in Jung-gu, Seoul, on September 22. Heo Jeong, a professor of economics at Sogang University, referenced Japan's decision to hand over 90% of its investment profits to the U.S., stating, "Japan made this choice to protect its vested interests accumulated over 30 years of investment in the U.S., but Korea should take a different approach." He added, "It is worth considering a profit-sharing structure that stipulates a minimum return but guarantees additional returns if certain achievements are met, such as local employment and parts procurement."
Professor Heo cited an example in which an additional 2% return is automatically guaranteed for every 1,000 jobs created. He also proposed designating 5-10% of the total investment exclusively for research and development (R&D), collaborating with U.S. Department of Energy (DOE) and National Institute of Standards and Technology (NIST) programs, and jointly owning intellectual property rights generated from these collaborations.
The event was attended by Choi Jungkyung, President of the Korea-US Association; Park Iljun, Executive Vice President of the Korea Chamber of Commerce and Industry; Lee Hyemin, visiting professor at Hankuk University of Foreign Studies and former head of the Korea-US Free Trade Agreement (FTA) planning team; Choi Wonmok, professor at Ewha Womans University Law School; Heo Jeong, professor of economics at Sogang University and president of the Korea International Trade Association; as well as representatives from the semiconductor, automotive, shipbuilding, and battery industry associations.
Choi Wonmok, professor at Ewha Womans University Law School, stated, "Protectionism based on political consensus in the U.S. will likely persist for at least another 20 years," adding, "A 'package deal' strategy that covers trade, diplomacy, and security issues-including favorable investment profit-sharing, professional visa and employment stabilization, and a freeze on defense cost-sharing rates-in exchange for large-scale investment, would be effective."
There was also a call to ensure that a significant number of domestic workers are employed in jobs created in the United States. Professor Heo emphasized, "It is crucial to resolve the issue of securing skilled professionals, which is hampered by visa issuance restrictions," and explained, "To efficiently operate local production facilities and prevent technology leaks, it is necessary to dispatch managers and engineers. However, small and medium-sized enterprises rely on the quota-limited H-1B (specialty occupation visa), making stable employment difficult."
Professor Heo further suggested: ▲ pursuing priority allocation of H-1B visas; ▲ establishing a Korea-exclusive employment visa (E-4), similar to Australia's system; and ▲ creating an expedited review system for U.S. visas such as L-1 and H-1B, which currently take more than six months to process.
Jung Seokjoo, Executive Director of the Korea Offshore & Shipbuilding Association, also commented, "Dispatching domestic professionals is necessary for the modernization of U.S. shipyards and the training of skilled personnel," adding, "It is time to consider improving the visa system through close consultations between the two countries."
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