2023-04-20 22:15:02
The heads of the four major groups will accompany President Seok-yeol Yoon on a state visit to the United States. As a result, attention is focused on the results that the economic delegation will bring. As the U.S. is putting forward a home-centered policy in major domestic industries such as semiconductors, automobiles, and batteries, domestic companies are expected to focus on making a breakthrough together with the government.
The heads of all four groups came forward
According to the Federation of Korean Industries (FKI) on the 20th, 122 domestic companies will accompany President Yoon Seok-yeol’s state visit to the United States at the end of this month as an economic delegation. It is the largest since the inauguration of this government. There are a total of 122 organizations, including 19 large corporations, 85 small and medium-sized enterprises, 14 economic organizations, associations and organizations, and 4 public corporations.
In particular, the delegation is attended by the heads of the four major conglomerates, including Samsung Electronics Chairman Lee Jae-yong, SK Chairman Chey Tae-won, Hyundai Motor Group Chairman Chung Eui-sun, and LG Chairman Koo Kwang-mo, as well as the heads of six major economic organizations, including Korea International Trade Association Chairman Koo Ja-yeol and Korea Federation of Small and Medium Business Chairman Kim Ki-moon. This is the first time in 20 years since 2003.
In addition, △Lotte Chairman Shin Dong-bin △Hanwha Vice Chairman Kim Dong-gwan △GS Chairman Huh Tae-soo △HD Hyundai President Jung Ki-seon △CJ Chairman Lee Jae-hyun △Korean Air Chairman Cho Won-tae △Doosan Chairman Park Jung-won △LS Chairman Koo Ja-eun △Hyosung Chairman Cho Hyun-joon △SK On CEO Choi Jae-won also joined the delegation. raised
The theme of the delegation’s visit to the US this time is ‘high-tech industry’. It includes semiconductors, aerospace, defense, and energy. The delegation will attend the Korea-US Advanced Industry Forum hosted by the Federation of Korean Industries and the US Chamber of Commerce, the White House welcome event hosted by the US government, and the Korea-US cluster round table hosted by the Ministry of SMEs and Startups to discuss ways to cooperate.
Choi Sang-mok, Senior Secretary to the President for Economic Affairs, said, “The three keywords for strengthening the high-tech alliance are high-tech industrial supply chain, high-tech science and technology, and attracting investment from high-tech companies. will be strengthened,” he said.
Should I minimize the influence of the Semiconductor Act and the IRA?
The industry is keenly aware of the actions of this economic delegation. This is because the US is strengthening its own-priority policies such as the Semiconductor Support Act and the Inflation Reduction Act (IRA). Domestic companies have a homework to minimize the damage caused by this. This is the reason why the heads of the domestic business world have been mobilized.
First of all, the semiconductor industry is expecting a reduction in the scope of submission of materials related to semiconductor subsidy applications. Last month, the U.S. Department of Commerce set forth the production capacity, operation rate, and expected yield (percentage of defect-free products) by wafer type as requirements for subsidy applications for semiconductor factories. In effect, a company’s trade secrets must be disclosed in order to apply for a subsidy.
Accordingly, domestic semiconductor companies are contemplating whether to apply for subsidies. Currently, Samsung Electronics is building a foundry plant in Taylor, Texas, by investing $17 billion. SK Hynix plans to invest $15 billion in advanced packaging manufacturing facilities for memory semiconductors. Regarding the subsidy application, Vice Chairman Park Jung-ho of SK Hynix said, “The application form was very complicated,” and “I will think about it a lot.”
The industry is of the opinion that the government needs to find a solution. In a recent report, the Korea Economic Research Institute under the Federation of Korean Industries said, “As an economic security issue at the Korea-US summit, it is necessary to request easing of requirements for the US semiconductor law.” We need to negotiate so that favorable conditions are reflected,” he stressed.
The automobile and battery industries must resolve the uncertainty of IRAs. The IRA provides subsidies in the form of tax credits only for electric vehicles finally assembled in North America. However, both Hyundai and Kia were excluded from subsidies.
In the case of the battery industry, it is considered a beneficiary of IRAs. However, homework on securing the battery supply chain remains. According to the IRA, from 2025, key minerals used in battery manufacturing must not be procured from ‘foreign concern groups’.
As much as the IRA is a bill to keep China in check, China is likely to be included in foreign concern groups. For the battery industry, where most of the core minerals are from China, ‘de-sinicization’ of the supply chain is urgent.
Meanwhile, Samsung and LG set out to stir up the atmosphere by showing videos of Korean War veterans in New York Times Square ahead of President Yoon Seok-yeol’s visit to the United States. For two weeks starting from this day, the two companies will screen a video dedicated to the ’70th Anniversary of the ROK-US Alliance’ to show respect and gratitude to the Korean War veterans.
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