Minister of Industry: "US Secretary of Commerce Confirms Efforts to Address IRA Issues"

Minister Lee Chang-yang of the Ministry of Trade, Industry and Energy is speaking at the meeting of presidents of the top 10 groups to respond to the global energy crisis held at the Korea Chamber of Commerce and Industry in Jung-gu, Seoul on the 26th. Photo by Moon Ho-nam munonam@

[Asia Economy Sejong=Reporter Dongwoo Lee] On the 26th, Lee Chang-yang, Minister of Trade, Industry and Energy, announced that Gina Raimondo, U.S. Secretary of Commerce, confirmed her intention to accept South Korea's concerns regarding the Inflation Reduction Act (IRA) and make efforts to address them.

At a press conference held at the Government Complex Sejong on the same day, Minister Lee said, "During my recent visit to the U.S., I met with Secretary Raimondo and confirmed that she fully empathizes with the issues raised by South Korea and has the will to resolve them," referring to the IRA's discrimination against U.S.-made and foreign-made electric vehicles.

Minister Lee cited the confirmation of Secretary Raimondo's intention to make efforts to accept South Korea's concerns in any possible way as the greatest achievement of his visit to the U.S.

He added, "One of Secretary Raimondo's expressions was that she would 'represent South Korea's interests within the White House or the government.' The semiconductor law's guardrail provisions are also being concretized through consultations between the Secretary of Commerce and other ministers, and she promised to consult with South Korea in advance on this matter as well."

He continued, "Among the lawmakers I met in the U.S., some were not fully aware of the IRA due to its vastness and complexity," and added, "There was a general acknowledgment that since the bill was rapidly created in a politically divided Senate, there are imperfect aspects."

Minister Lee mentioned, "There are about three ways we are considering: cooperating with the executive branch to resolve the issues, working through the legislature, and coordinating with the European Union and Japan."

Regarding his visit to Canada, he emphasized, "The new cooperative relationship with Canada has been significantly strengthened, especially concerning the IRA. Going forward, a large amount of critical minerals will be needed in advanced industries, and Canada is expected to be favorable for stable supply."

In response to criticism that the domestic investment by Applied Materials (AMAT), presented as an achievement during the U.S. visit, was the same as the previously signed Memorandum of Understanding (MOU), he explained, "Although the MOU was signed in July, discussions have progressed since then, and this time it has been finalized with the submission of the notification."

Regarding the possibility of an increase in industrial electricity rates next month, Minister Lee said, "Large-scale users consume a lot and receive many benefits. We think it would be good to reflect price signals starting from this sector, so we are internally reviewing it and consulting with the Ministry of Economy and Finance on timing and rates."

He also introduced, "Providing electricity below cost usually causes trade issues. The government’s provision of cheap electricity is perceived as subsidies to companies, which can lead to trade problems such as countervailing duties. Recently, the U.S. has also shown movements such as requesting information about Korea Electric Power Corporation (KEPCO)."

He emphasized, "The structure of supplying electricity below cost needs to be gradually improved. Normalizing prices and sending signals to the market will lead to more efficient use by both companies and households."

Regarding the flood damage at POSCO Pohang Steelworks, he said, "I have been informed that a considerable number of factories are expected to be operational by the end of the year, and the possibility of market stabilization looks quite high," adding, "The Ministry of Trade, Industry and Energy has no position to reprimand or hold POSCO responsible."

On the export-import trends for September, he forecasted, "Unless energy prices stabilize downward, a rapid improvement in the trade balance is unlikely, and since there are no recent signs of such, I expect a deficit this month as well."

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