Auto, chip sectors spared from US reciprocal tariffs but face imminent damage from sectoral duties
Cars are parked ready to be exported at a port in Pyeongtaek, Gyeonggi Province, Wednesday. Yonhap
The United States plans to impose 25 percent reciprocal tariffs on a broad range of Korean imports starting next week, but spared automobiles, semiconductors and steel products from the measure.
The exemption, however, does not necessarily signal relief for these core sectors of Korea's export-driven economy, as they are already subject to, or are expected to soon face, separate sector-specific tariffs under U.S. President Donald Trump's "America First" trade policy.
According to data from the Korea International Trade Association (KITA), Korea's exports to the U.S. totaled $127.8 billion in 2024, up 10.4 percent from the previous year, marking the highest annual tally on record.
Of the total, automobile exports accounted for $34.7 billion, or 27.2 percent.
Semiconductors and memory chips, including DRAM modules, reached $8.2 billion, representing 6.4 percent of the total.
Steel exports were valued at $2.9 billion, or approximately 2.3 percent. According to the U.S. International Trade Administration, Korea was the fourth-largest steel exporter to the U.S. in 2024, supplying 9 percent of America's total steel imports.
When combined, the three sectors made up approximately 36 percent of Korea's total exports to the U.S. last year, underscoring their weight in bilateral trade.
While the exemptions may help avoid additional damage to Korea's top export categories in the short term, industry observers say existing or expected tariffs in these sectors will still pose significant challenges to export growth.
The newly imposed reciprocal tariffs are expected to affect a range of other industrial and consumer goods.
According to KITA's 2024 export data, affected items should include batteries and petroleum products, which accounted for $3.9 billion and $5.1 billion in U.S.-bound exports, respectively, among others.
The Ministry of Trade, Industry and Energy was set to hold a meeting with industry representatives later in the day in Seoul to assess the scope of the impact and explore possible response measures. (Yonhap)