The South Korean National Assembly is expected to finalize the text of the “Special Act on Investment in the United States” on Monday (March 9th), paving the way for a full vote during this week’s Thursday meeting. This is crucial for alleviating the trade uncertainty brought about by policies.
After completing his visit to the United States, South Korean Minister of Industry and Commerce Kim Jung-kwan stated that the U.S. has sent positive signals. If the bill is successfully passed, the U.S. is considering not raising tariffs on South Korean goods.
According to Bloomberg, Kim Jung-kwan revealed to the media upon his arrival at Incheon Airport on Sunday evening that he had briefed U.S. Commerce Secretary Howard Lutnick on the legislative progress in the South Korean National Assembly this week, and the U.S. response was positive.
Kim Jung-kwan pointed out, “If the law is passed as planned, it seems unlikely that the U.S. will issue any official notices of additional tariffs.”
He added that South Korea has secured the possibility of receiving treatment equal to or even more favorable than its competitors.
This special law aims to fulfill South Korea’s commitment to invest as much as $350 billion in the United States, covering key sectors such as shipbuilding and semiconductors, and establishing a dedicated investment platform and risk management committee.
Previously, United States President Trump had indicated in January that due to delays in South Korea’s legislative progress, he was considering raising tariffs from the agreed 15% to 25%.
Facing significant trade uncertainty, South Korea’s six major business groups, including the Federation of Korean Industries, the Korea Chamber of Commerce and Industry, the Korea Enterprises Federation, the Korea Trade-Investment Promotion Agency, the Korea Federation of Small and Medium Businesses, and the Korea Employers Federation, issued a joint statement last Tuesday urging the National Assembly to take immediate action.
In the statement, the business groups emphasized, “The Assembly should pass the bill within the special committee’s activity time frame, allowing South Korean businesses to minimize trade risks and actively expand exports to the U.S.”
South Korean companies are concerned that a continued delay in the legislative process could impact about 18% to 19% of South Korea’s total exports to the U.S. The U.S. remains South Korea’s largest export market, and any changes in U.S. trade policies could also affect companies’ investment plans and production strategies.
Despite a glimpse of progress in the legislative process, South Korean officials remain cautious about large-scale foreign investments. Some officials are concerned that massive investments in the U.S. may further weaken the South Korean won’s exchange rate, emphasizing that future investment projects still need to consider commercial viability and foreign exchange market conditions.