Seoul Denies Semiconductors Lead US Investment Plan

South Korea's Industry Ministry has dismissed reports that semiconductors are being considered as the first project under its investment commitments in the United States. The clarification comes as Industry Minister Kim Jung-kwan holds discussions in Washington over the investment package and related tariff issues.

The ministry issued a statement saying it is not true that semiconductors are being discussed as a candidate for the first strategic investment project in the US. This follows a local newspaper report suggesting Seoul had initially considered an energy project but shifted its position after Washington pushed for investment in US memory chip production facilities.

While confirming that discussions over potential investment projects remain ongoing, the ministry declined to disclose specifics. It stated that the government has continued communicating with the US side regarding strategic investment projects but cannot confirm the details of bilateral discussions.

Kim departed for Washington on Sunday, roughly three weeks after a July visit focused on investment and shipbuilding cooperation. Upon arrival, he indicated that Seoul had aimed to announce the first project in late August or early September. However, he noted that additional working-level issues had emerged as negotiations entered their final stage.

His return date remains undecided and could shift depending on the progress of talks, according to the ministry. The two countries are working to accelerate implementation of investment commitments made under their tariff agreement. Kim is also expected to discuss the investment package alongside potential additional US tariffs under Section 301.

Concerns have grown that duties linked to forced labour and an ongoing investigation into industrial overcapacity could push tariffs on some South Korean products above the 15 per cent ceiling set under the bilateral agreement. Under that agreement, Washington lowered tariffs on South Korean goods from 25 per cent to 15 per cent last year in exchange for USD 350 billion in investment commitments. Of this, USD 150 billion was allocated to shipbuilding cooperation, while the remaining USD 200 billion is still under negotiation.

A gas-fired combined-cycle power plant in Texas has been mentioned as a potential first project, although key terms have not been finalised.