On Wednesday, U.S. President Donald Trump signed a proclamation imposing a 25% tariff on certain high-performance computing semiconductors, including Nvidia’s H200, marking the beginning of a semiconductor war. While he delayed tariffs on critical minerals, he warned of alternative measures if an agreement isn’t reached.
This action follows the U.S. Department of Commerce’s national security threat assessment on imported semiconductors under Section 232 of the Trade Expansion Act. Analysts believe this could lead to broader tariffs on all imported semiconductors and related products.
In response, South Korean semiconductor giants like Samsung Electronics and SK Hynix are closely monitoring whether the semiconductor tariffs the Trump administration has been signaling since last year will actually be implemented.
Since 1997, semiconductors have enjoyed zero tariffs among World Trade Organization (WTO) members under the Information Technology Agreement (ITA). If the U.S. imposes high tariffs, the impact could be substantial. However, with specific items and rates yet to be finalized, it’s premature to assess the full implications.
An industry insider pointed out that the U.S. imports semiconductors from countries such as South Korea and Taiwan, warning that imposing tariffs could produce negative consequences. The source added that it remains to be seen whether the U.S. will ultimately follow through.
Another source said some analysts view the move as an attempt to impose tariffs on Nvidia’s H200 exports to China, adding that it is still too early to determine the overall impact.
Despite Trump’s postponement of tariffs on critical minerals, related industries remain vigilant. This concern stems from the fact that high-purity sulfuric acid used in semiconductor wafer cleaning and essential materials for advanced devices, such as germanium, indium, and antimony, are byproducts of the refining process.
Instead, the U.S. plans to work with allies to introduce a price floor for critical minerals to counter Chinese price dumping. This system aims to prevent prices from falling below a set minimum through government or international agreements. The measure seeks to stop China, with its established production capacity, from dominating the market through low-price strategies. China’s competitive pricing makes it difficult for other countries to invest in mineral production, increasing global dependence on Chinese supplies.
The recent announcement clarifies that the ultimate goal is to secure production facilities within the U.S. This strategy is expected to benefit companies that have already established a direct presence in America.
For example, KoreaZinc is advancing Project Crucible in partnership with the U.S. government, aiming to produce 13 non-ferrous metal products, including 11 of the 60 critical minerals designated by the U.S. government.
An industry expert stressed the importance of closely tracking discussions between the U.S. and South Korean governments, as well as how the U.S. plans to implement its measures. Over the longer term, the expert said these moves could accelerate the expansion of semiconductor and critical mineral production and processing capacity in the United States, potentially creating new opportunities for companies that have already invested in U.S. operations and diversified their supply chains.
The South Korean government plans to respond by holding emergency meetings with industry stakeholders and closely monitoring the situation.
The Ministry of Trade, Industry and Energy has initiated follow-up actions under Minister Kim Jeong Kwan’s leadership. Separate industry meetings will be held, chaired by the Director of Industrial Growth for the semiconductor sector and the Director of Resources for the critical minerals sector, to analyze the impacts of U.S. actions and formulate response strategies.