South Korean Trade Minister Yeo Han-koo will meet with US officials in Washington this week for the third round of technical tariff discussions.

He plans to raise concerns from South Korea’s semiconductor industry about potential US policies that could affect chipmakers operating in China.

Yeo stressed the need for careful consideration, warning that new measures could hinder manufacturing activities.

The discussions are part of ongoing efforts to reduce tariffs between the two countries.

While a July 8 deadline was proposed, Yeo said the talks might extend due to political and economic uncertainties in the US.

He also plans to meet with White House and Congressional officials to address broader trade issues, including a US request for South Korea to ease import rules on American beef.

🔗 Source: Reuters

🧠 Food for thought

1️⃣ South Korean chipmakers caught in a deepening US-China tech rivalry

South Korean semiconductor giants like Samsung and SK Hynix maintain significant manufacturing operations in China while simultaneously investing billions in the US market.

These companies face increasing pressure as the US has imposed strict export controls on semiconductor technology to China, aiming to prevent advanced manufacturing capabilities from reaching Chinese firms 1.

The Biden administration’s expansion of controls in October 2022 has created a particularly challenging environment for South Korean firms that rely on operations in both markets 1.

This predicament explains why South Korea’s trade minister is raising concerns about potential restrictions on foreign chipmakers in China during US-South Korea trade talks.

The Netherlands has announced plans to restrict semiconductor technology exports to China in alignment with US efforts, which could further complicate South Korea’s position 2.

2️⃣ High-stakes economic interdependence driving negotiation leverage

South Korea has strategically positioned itself as the largest foreign investor in the United States, driven significantly by incentives from the CHIPS Act 3.