On Sept. 4 in Georgia, after the mass detention of Korean workers, multiple Korean corporations were found to have withdrawn or put on hold investment projects planned in the United States. The U.S. government belatedly moved to contain the fallout with an "investment-friendly" message, but investor sentiment, already chilled, does not appear to be recovering easily. Some analysts say a warning light has turned on for the fulfillment of the $350 billion (about 470 trillion won) pledge to invest in the United States.
The Washington Post (WP) reported on the 1st (local time), citing multiple industry sources including consultants and attorneys based in the United States, that since the "Georgia incident," at least two Korean corporations have scrapped investment projects they had planned in the U.S. At least four companies were said to have extended the suspension period for their U.S. investments, which had been temporarily halted. The consultants and attorneys did not disclose the names of the corporations out of concern it would negatively affect their business relationships with clients.
Experts agreed that the "investment chill" felt on the ground is severe. Tammy Overby, an international business consultant who formerly chaired the U.S.-Korea Business Council under the U.S. Chamber of Commerce, said, "A Korean corporation had been searching for a plant site in the United States but, after the (Georgia incident), shifted course to expand a plant in Korea out of concern about the 'uncertainty' and risks of the U.S. market."
Chris Thomas, an immigration attorney at the Denver-based law firm Holland & Hart, also said, "A large Korean IT corporation client dropped its plan to enter the U.S. after this incident." The corporation is instead said to be reviewing options to expand its footprint in Korea or India. Thomas said, "The fallout from this enforcement action is clear," adding, "Japanese and Korean corporations, as well as some other clients, have informed us they will 'put everything on hold for the time being.'"
The incident traces back to Sept. 4. On that day, U.S. Immigration and Customs Enforcement (ICE) agents conducted a sweeping raid on a battery joint-venture plant under construction in Georgia by Hyundai Motor and LG Energy Solution. The plant had been hailed by Georgia Gov. Brian Kemp as "the largest in the state's history" and was a symbolic site of U.S.-Korea economic cooperation. But the raid led to the handcuffed detention of more than 300 Korean workers who had entered on business visitor visas (B-1/B-2), and they were released only after seven days, following negotiations between the two governments. The incident etched "deadly uncertainty" into Korean corporations that had planned sizable U.S. investments.
WP noted that, beyond fear of immigration enforcement, new visa restrictions by the Donald Trump administration are also weighing on investment. In particular, the plan to impose a new $100,000 (about 130 million won) fee on H-1B specialty occupation visas has heightened such anxieties. Jonathan Cleave, CEO of international business consulting firm Intralink, said, "Employees are increasingly reluctant to take U.S. assignments," adding, "This complicates corporations' decision-making processes."
As the situation widened, the White House and President Trump belatedly moved to "put out the fire." White House deputy press secretary Kush Desai issued a boilerplate statement that "President Trump is committed to making the United States the most dynamic and investment-friendly economy." Trump himself also told reporters ahead of recent trade talks that he was "strongly opposed" to the enforcement action carried out by his administration. U.S. Commerce Secretary Howard Lutnick also met last week in Gyeongju with leaders of Korea Inc., including Samsung Electronics, SK Group, Hyundai Motor Group and LG Group, emphasizing a resolution to visa issues.
Some experts say this U.S. effort to soothe concerns is having some effect. Consultant Overby said, "Discussions in recent weeks, especially the just-announced trade deal, are greatly helping to reassure Korean investors." LG Energy Solution, at the center of the incident, also said it resumed business trips in October.
But anxiety remains on the ground. Kurt Tong, former ambassador to the Asia-Pacific Economic Cooperation (APEC), said, "The new trade deal will reassure some investors, but the 'Hyundai incident' still leaves a 'fairly bad aftertaste.'"
In fact, LG Energy Solution confirmed that the Georgia battery plant "will not be able to meet the originally scheduled completion date at the end of 2025." SK On and SK hynix said their projects are proceeding as planned, but Hyundai, Samsung and Hanwha did not respond to WP's inquiries.
Ultimately, experts say fundamental trust will be hard to restore with short-term fixes alone. Citing Intralink CEO Cleave, WP said, "The Georgia enforcement is only one of several reasons corporations hesitate to invest in the U.S.," adding, "The core concern for corporations is the chaotic nature of U.S. governance."