Ministry of Industry, Europe Raw Materials Act Similar to IRA..."Public-Private Response from the Start"

[Asia Economy Sejong=Reporter Dongwoo Lee] The government plans to respond jointly with the public and private sectors from the early stages to the Raw Materials Act (RMA) that the European Union (EU) is recently pushing to introduce targeting China.

The Raw Materials Act can be interpreted as having a similar purpose to the U.S. Inflation Reduction Act (IRA), and there are opinions that preemptive measures at the government level and from related domestic industries such as batteries are necessary.

The Ministry of Trade, Industry and Energy announced on the 18th that it held a joint public-private meeting to discuss the trends in the EU Raw Materials Act legislation and countermeasures, presided over at the Korea Chamber of Commerce and Industry in Jung-gu, Seoul. Yoon Chang-hyun, Director General of Trade Policy at the Ministry, said, "It is necessary for the public and private sectors to actively respond from the early stages to ensure that the Raw Materials Act complies with international norms and is designed without discriminatory elements against our companies."

The government plans to monitor the progress of the Raw Materials Act, communicate with the industry, and continue related consultations with the EU. The EU, which announced its plan to introduce the Raw Materials Act on the 14th of last month, plans to collect stakeholder opinions by the 25th of next month and announce a draft bill in the first quarter of next year.

The EU Raw Materials Act aims to select strategic critical raw materials, strengthen related value chains, and improve crisis response capabilities by establishing an early warning system for supply chains and a supply chain development fund.

Through this, the plan is to diversify supply chains while strengthening domestic production, recycling, and research & innovation (R&I) capabilities. The diversification of supply chains for key minerals such as lithium and rare earths used in electric vehicle battery materials, which are at the core of the recent raw materials acquisition war, is expected to become a key issue.

At the meeting, related organizations and groups such as the Korea Chamber of Commerce and Industry, Korea International Trade Association, KOTRA, Korea Institute for Industrial Economics & Trade, and Korea Institute for International Economic Policy agreed to monitor the EU Raw Materials Act legislation trends together with related industries and seek countermeasures, including participating in opinion collection procedures if necessary.

Yeon Won-ho, head of the Economic Security Team at the Korea Institute for International Economic Policy, said, "It appears that the EU is pushing for the enactment of the Raw Materials Act to reduce dependence on China for raw materials and to build a resilient supply chain."

This content was produced with the assistance of AI translation services.