With a U.S. Supreme Court ruling that the "reciprocal tariff" the United States had imposed on the world is invalid, tariff uncertainty has emerged as a new variable for Korea's economy. It is a green light for the economy that the reciprocal tariff, which U.S. President Donald Trump levied with differences by country, was found unlawful. But it is a risk that Trump has signaled a 15% global tariff and item-specific tariffs remain in place.
◇ Will item-specific tariffs replace reciprocal tariffs
According to relevant ministries on the 22nd, the key focus in U.S. tariff policy is its impact on Korea's export front. Korea, in tariff talks with the United States, lowered the reciprocal tariff from the previous 25% to 15% starting in November last year. However, last month Trump warned in Korea's National Assembly that he would raise the tariff rate to 25%, citing delays in the handling of the special bill on investment in the United States. As in Trump's recent remarks, if a 15% global tariff is imposed, the tariff rate would appear lower on the surface.
The problem is item-specific tariffs. That is because what the U.S. Supreme Court found unlawful was the reciprocal tariff. Item-specific tariffs imposed on automobiles, steel and semiconductors remain in effect. Korea's key export products are highly likely to be hit by item-specific tariffs. Even if the reciprocal tariff disappears, it cannot be guaranteed that obstacles hobbling export corporations are gone. Among experts, there are also voices saying uncertainty over item-specific tariffs has grown.
The previous day, Koo Yun-cheol, Deputy Prime Minister for the Economy and Minister of Economy and Finance, held an emergency meeting with key senior officials at the first grade level and the Directors General and Directors under his purview. At the meeting, Koo was quoted as saying, "Please thoroughly grasp developments in the United States and how major countries are responding." The Ministry of Trade, Industry and Resources, the lead ministry for trade, plans to hold a public-private joint countermeasure meeting on the 23rd, presided over by Minister Kim Jung-kwan, to review impacts by domestic industry.
◇ $350 billion investment in the United States proceeding as planned
In the market, attention is on whether the $350 billion investment in the United States that our government pledged in tariff negotiations with the United States will also enter a new phase. Some say that since there is a ruling that the reciprocal tariff is unlawful, the investment agreement with the United States is also invalid.
In this regard, the government's stance for now is to proceed with the investment as originally planned. Other countries that pledged investment in the United States are not seeking renegotiations, and Korea appears to judge there is no need to move first. In fact, Japanese media reported that the Japanese government is highly likely to carry out its $550 billion investment in the United States as agreed.
Meanwhile, tariff refunds have also emerged as a task. Although tariff payers can seek refunds, it is expected to take time for U.S. Customs and Border Protection (CBP) to establish detailed refund procedures. The Korea Customs Service said, "There will be an announcement from U.S. CBP on specific future refund procedures and methods," adding, "We will swiftly grasp related developments and provide real-time guidance to our export corporations."