Gov't to devise chip industry support measures in response to US tariffs
Industry Minister Ahn Duk-geun, right, speaks during a meeting at the Korea Trade Insurance Corporation in Seoul, April 10. Yonhap
The government will "swiftly" devise support measures for the local chip industry to cushion the impact of the United States' planned tariffs on semiconductor imports, the industry minister said Thursday.
Industry Minister Ahn Duk-geun said the government measures would be announced in the very near future while meeting with officials from local chip manufacturers to discuss a response strategy against the planned U.S. tariffs.
U.S. President Donald Trump has warned of tariffs on semiconductor imports since taking office in January, and reaffirmed the plan last week, saying they will begin "very soon."
In Thursday's meeting, semiconductor industry officials called on the government to actively negotiate with the U.S. and devise support measures to minimize the tariffs' impact on local businesses, according to the Ministry of Trade, Industry and Energy.
The business officials noted the proposed tariffs may have a limited impact on the local chip industry, pointing to the U.S.' limited production capacity and Korea's high global market share, especially in high-value products, such as high bandwidth memory.
They still expressed serious concerns over growing uncertainties in the global trade market that may adversely affect the local industry, as well as the economy, according to the ministry.
The ministry said the government's potential support measures for the chip industry may include tariff response vouchers and efforts to reduce cost burdens from materials and components that rely heavily on imports.
The government is also reviewing expanding the domestic use of Korean-made chips for the national artificial intelligence (AI) computing center and assisting Korean companies in exporting their chips to AI data centers in the Middle East and Southeast Asia.
To encourage corporate investment in the semiconductor sector, the government is considering stronger incentives, such as additional financial support for the semiconductor cluster in Yongin, just south of Seoul, and regulatory streamlining.
The ministry also said there will be efforts to enhance the overall competitiveness of the semiconductor ecosystem, including the construction of fabrication plants for advanced chips and the launch of large-scale research and development projects.
Specifically, the government aims to invest 1 trillion won ($674.3 million) in developing on-device AI chips for use in the automotive, robotics, defense and Internet of Things industries.
"The private and public sectors must work together to address the trade and supply chain risks we currently face," Ahn said.
"The government will continue negotiations with the U.S. through various channels and swiftly implement support measures for the semiconductor industry by mobilizing the nation's full capabilities as the tariff war is also a battle for attracting corporate investment," he added.