Holding of Korea-US Business Council Meeting... Urging Elimination of Trade Discrimination Due to IRA

Advocacy for Stable Supply Chain Management Cooperation and the Need to Improve Export Regulations

Guests, including Kim Jin-pyo, Speaker of the National Assembly (eighth from the left in the front row), and Huh Chang-soo, Chairman of the Federation of Korean Industries (ninth from the left in the front row), are taking a commemorative photo at the 'Korea-US Business Council Welcome Dinner' held at Sarangjae, National Assembly, on the 19th.

[Asia Economy Reporter Park Sun-mi] The business communities of South Korea and the United States gathered face-to-face for the first time in three years since the outbreak of COVID-19 to discuss ways to strengthen bilateral cooperation, including responses to the U.S. Inflation Reduction Act (IRA) and the Chips and Science Act (CSA), supply chain collaboration, and the signing of a currency swap agreement.

On the 20th, the Federation of Korean Industries (FKI) announced that it held the "34th Korea-U.S. Business Council General Assembly" jointly with the U.S. Chamber of Commerce at the FKI Hall. Under the theme "Transition to the Era of Global Economic Security: Opportunities and Challenges for Korea-U.S. Economic Cooperation," the joint meeting discussed ▲ the Korea-U.S. alliance and economic security ▲ climate crisis and energy cooperation ▲ digital economy and trade utilizing the Indo-Pacific Economic Framework (IPEF) ▲ growth of digital health and pharmaceutical industries ▲ financial stability in Northeast Asia and Korea-U.S. cooperation.

Huh Chang-soo, Chairman of the Korea-U.S. Business Council and Chairman of the FKI, emphasized in his opening remarks the need for stable management cooperation of global supply chains by both governments and the improvement of export control policies such as the Biden administration’s Inflation Reduction Act.

Chairman Huh stressed, "The Korea-U.S. business sectors are closely connected within the supply chains of high value-added industries such as semiconductors, advanced machinery, and automobiles, so through in-depth discussions on IPEF and the chip4 alliance (chip4: Korea, U.S., Japan, Taiwan), we must swiftly quell the current supply chain disruptions." He also urged countermeasures, stating, "The implementation of the Inflation Reduction Act is already affecting the sales of Korean products in the U.S."

Foreign Minister Park Jin, in his keynote speech, noted that the two countries are closely cooperating at bilateral and multilateral levels as an economic security and technology alliance, and requested the Korea-U.S. Business Council’s continued interest and role in promoting economic cooperation between the two nations.

At the plenary session, opinions were presented that the Korea-U.S. alliance should play a pivotal role in discussions such as IPEF to enhance the resilience of global supply chains and that the scope of economic security cooperation should be expanded. In particular, there were discussions among government officials from both countries regarding cooperation in supply chains of core industries such as semiconductors, green transition, and digital economic transformation. Yang Hyang-ja, Chairwoman of the National Assembly Semiconductor Special Committee, gave a presentation on the Korea-U.S. alliance and economic security, introducing ways to strengthen the Korea-U.S. global value chain through the semiconductor alliance.

It is encouraging that participants from both countries at this general assembly agreed on the need to improve trade restrictive measures and corporate regulations that do not conform to the principles of the Korea-U.S. economic alliance and the Korea-U.S. Free Trade Agreement (FTA). U.S. participants also actively agreed on the need for improvements, stating that discrimination against Korean products under the Inflation Reduction Act is inconsistent with the spirit of the Korea-U.S. alliance and the Korea-U.S. FTA.

The joint declaration specified the need to improve the U.S. Trade Expansion Act Section 232, the Inflation Reduction Act, and Korea’s Serious Accident Punishment Act. In particular, both sides agreed to continue raising issues such as the exclusion of Korean electric vehicles from subsidies and to seek non-discriminatory solutions, with these points adopted in the joint declaration.

Participants from both countries also urged the establishment of a permanent Korea-U.S. currency swap agreement or equivalent measures as follow-up actions to the "foreign exchange market consultations" included in the joint statement between the Korea-U.S. leaders in May, to enhance the stability of South Korea’s foreign exchange market, a key U.S. ally. Kwon Tae-shin, Vice Chairman of the FKI, emphasized, "Given Korea’s status in Asia’s economy, our turmoil inevitably spreads to East Asia and Southeast Asia," and added, "Instability in the Korean economy and financial markets is by no means desirable from the U.S. perspective on Northeast Asian security."

Meanwhile, at this meeting, the Korean business community also requested U.S. support for Busan’s bid to host the 2030 Expo, as Korea, competing with Saudi Arabia, is a country sharing common values with the United States.

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