The South Korean president responds to chip tariff threats: If taxes increase by 100%, it will only make Americans pay the price themselves!
Lee Jae-myung stated that given that South Korean and Taiwanese chip manufacturers hold a monopoly position of 80% to 90% in the global market, the United States imposing a 100% import tariff is likely to lead to a significant increase in chip product prices in the U.S., with most of the costs likely being passed on to U.S. prices
South Korean President Lee Jae-myung responded strongly on Wednesday to the proposed U.S. semiconductor import tariffs, believing that this policy will ultimately drive up domestic prices in the United States.
Lee Jae-myung pointed out at a press conference:
Given that South Korean and Taiwanese chip manufacturers hold a monopoly position in the global market of 80% to 90%, the U.S. imposing a 100% import tariff is likely to lead to a significant increase in chip product prices in the U.S., with most costs likely being passed on to U.S. prices.
This statement highlights South Korea's critical position in the global semiconductor supply chain. Samsung Electronics and SK Hynix dominate the memory chip sector, while TSMC holds a monopoly in the chip foundry market. South Korea's exports are expected to reach a record $709.4 billion by 2025, a year-on-year increase of 3.8%, with semiconductor shipments surging 22% due to strong demand from AI investments.
According to CCTV News, the White House announced on the 14th of this month that starting from the 15th, a 25% import tariff will be imposed on certain imported semiconductors, semiconductor manufacturing equipment, and derivatives. According to CCTV News, U.S. Secretary of Commerce Gina Raimondo subsequently threatened that South Korean memory chip manufacturers could face tariffs of up to 100% if they do not increase production in the U.S.
Lee Jae-myung: Safeguards Established Based on Trade Agreement with the U.S.
Lee Jae-myung emphasized that South Korea has established safeguards based on its trade agreement with the U.S. to ensure that South Korean chip manufacturers do not find themselves at a disadvantage compared to other global competitors.
Data on South Korea's semiconductor exports shows its level of dependence on the global market. Of the total semiconductor exports of $173.4 billion, exports of chips to the U.S. account for only 8%. This structure indicates that the actual impact of U.S. tariffs may be limited.
In his speech, Lee Jae-myung also mentioned the issue of the weakening won, stating that South Korean authorities expect the won to rise to about 1,400 won per dollar within one or two months. The president warned that relying solely on domestic policies is insufficient to stabilize the foreign exchange market, as the won is somewhat related to the weakening of the yen, but the won's performance is relatively good Lee Jae-myung stated that the South Korean domestic stock market was the best-performing market globally last year with a 76% increase, but it is still undervalued. South Korea's exports are expected to reach record levels by 2025, primarily benefiting from a surge in semiconductor demand driven by investments in artificial intelligence
