Korean companies express concerns over US inflation reduction law

Cho Kyung-ho, South Korea’s finance minister, met with his US and Chinese counterparts in India, to discuss ways to strengthen economic cooperation with the countries concerned, according to Korean news agency Yonhap yesterday.

Cho Kyung-ho, the finance minister, held separate talks with U.S. Treasury Secretary Janet Yellen and Liu Kun, China’s finance minister, on Monday, in Gandhinagar, India, on the sidelines of the G-20 meeting of finance ministers and central bankers.

During his meeting with Yellen, Zhou expressed Korean companies’ concerns about the U.S. Inflation Reduction Act and the Chip and Science Act. He asked Yellen to continue to pay attention to the relevant issues, citing doubts about the two laws, although he expressed gratitude for Washington’s ongoing efforts to conduct the relevant consultations.

The US Inflation Reduction Act provides tax credits of up to US $7,500 per buyer for a new electric vehicle assembled in North America, with a battery made of a specific quantity of important metals produced in the region, raising concerns of discrimination against foreign manufacturers.

Under the Chips Act, foreign chip companies can receive subsidies of $52.7 billion and tax incentives to establish production facilities in the United States, although the Act has many other conditions.

The Ministry said that the two sides also discussed Yellen’s recent visit to China, without elaborating. Earlier this month, Yellen made a trip to China that lasted four days.