Moon's US visit brings economic achievements
President Moon Jae-in delivers a speech during the Korea-U.S. Business Summit at the U.S. Chamber of Commerce in Washington, June 28. / Yonhap
By Kang Seung-woo
President Moon Jae-in talks with Thomas Donohue, president and CEO of the U.S. Chamber of Commerce, during the Korea-U.S. Business Summit. / Yonhap
The joint statement focusing on North Korea’s denuclearization was the highlight reel during President Moon Jae-in’s visit to the United States.
Above all, Moon’s U.S. trip is said to have sought quality over quantity as Korean companies came up with detailed investment plans rather than just signing non-binding memoranda of understanding (MOUs).But economic fruits from his maiden overseas trip as Korean president are also as productive as diplomatic achievements, observers pointed out Tuesday.
During Moon’s visit to Washington, D.C., for a summit with U.S. President Donald Trump, the business delegation, comprised of 52 top executives, announced that they will invest $12.8 billion into the U.S. economy over the next five years.
Plus, Korean corporations plan to spend $22.4 billion to purchase aircraft and other American products and resources.
These measures are unlike Moon’s predecessors, who typically promoted multiple MOUs with much fanfare, with many of them falling through.
Market watchers believe that the massive investment will help ease growing protectionist moves from the Trump administration.
“Amid mounting complaints about the trade imbalance between the two nations in the United States, the business delegation’s investment plans have given a message that they can set up a win-win situation,” said an official at a local business organization.
“It will effectively ease claims for a renegotiation of the Korea-U.S. free trade agreement (FTA).”
In the selection of representatives, the Korea Chamber of Commerce and Industry also prioritized companies with investment plans and projects in the U.S., which received credit for resulting in the specific action plans.
Taking a closer look at the economic achievement from the presidential trip, Samsung Electronics announced a long-awaited plan to build a plant for home appliances in South Carolina. The global tech giant will invest $380 million (436 billion won) and create 950 full-time jobs.
In addition, Samsung is planning to invest $1.5 billion in its semiconductor factory in Texas by 2020 to boost production of processor chips for smartphones and other devices.
The Samsung investments came four months after its cross-city rival LG Electronics came up with a plan to build a manufacturing facility for washing machines in Tennessee, along with its $300 million under-construction North American headquarters in New Jersey.
Those investments are expected to help alleviate trade pressure from the Trump administration that has pushed global companies as well as local business entities to build their factories in his country as part of efforts to create jobs for Americans under his campaign pledge of “Make American Great Again.”
Furthermore, some hope that the global home appliance powerhouses’ investments may prompt Whirlpool to drop long-standing anti-dumping allegations against Samsung and LG.
In May, the U.S. company filed a petition against the Korean companies, claiming they repeatedly relocated their washer manufacturing facilities to avoid trade sanctions, and the U.S. International Trade Commission instituted a 120-day investigation June 5.
SK Group has decided to beef up ties and expand investment in the U.S. shale gas sector in line with President Moon’s focus on new renewable energy and liquefied natural gas.
The nation’s third-largest conglomerate signed an MOU with General Electric and Continental Resources to form a strategic alliance for the shale gas project and announced its plans to invest 1.8 trillion won in the U.S. over the next five years.
The deal is expected to help Korea to diversify its energy imports and further sell U.S. energy resources to a third country.
The Moon administration plans to raise the proportion of power supplies from clean and renewable energy sources to 20 percent of the total by 2030.
“I hope that Korea-U.S. economic cooperation can expand on the existing level of mutual trade and investment so that it can help both countries become strategic economic partners who work together to pioneer the world market,” Moon said during the Korea-U.S. business summit.
The delegation’s big investments are also receiving rave reviews from the U.S. media as they say that Korean firms’ investments keep up with the U.S. government’s economic policy and shield trade pressure from Washington.