As a candidate and now as president, Donald Trump has engendered alarm in the South Korean government and its business community, much as is the case with Japan. This is because his policies could seriously affect Korean firms invested or planning to pour additional funds in the United States, exporting directly or indirectly (e.g., through Canada) to the U.S., participating in South Korea-U.S. economic security cooperation initiatives, having close ties to China, or embroiled in troublesome dealings with American companies in South Korea. The richness and importance of bilateral economic ties and the broader South Korea-U.S. economic and security partnership warrant a closer look at these generally undertreated issues and ways for Korean business to respond.
One threat that has gotten appropriate attention is the likely U.S. retreat from the Inflation Reduction Act (IRA), which has encouraged, among other things, Korean electric vehicle (EV) and electric battery investment in the U.S., as well as the CHIPS and Science Act, which has supported Korean semiconductor-related investment in the United States. Regarding the IRA, the issue is that the new U.S.
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