On Tuesday, Minister of Trade, Industry and Energy Kim Jung-kwan addressed the ongoing U.S.-Korea tariff negotiations. He stated that if the special law on investment in the U.S. passes in the National Assembly this month, there’s a strong likelihood that the U.S. will delay the tariff increase.
Speaking to reporters at the Sejong government complex, Kim explained that President Donald Trump has repeatedly cited legislative delays in the National Assembly as justification for tariff hikes. If it can resolve this issue, it could very well lead to a postponement of the tariff increases.
In a related development, the National Assembly passed a resolution to form a special committee. This committee will discuss the Special Law for Strategic Investment Management between the U.S. and Korea, a follow-up measure to the U.S.-Korea tariff talks. The committee is set to operate until April 9, with high expectations that the special law will be processed through bipartisan agreement before then.
Contingency Plans Activated in Response to Potential Ruling on Mutual Tariffs’ Legality
Kim also revealed that his ministry is preparing for the U.S. Supreme Court’s upcoming ruling on the legality of President Trump’s mutual tariff measures, alongside the ongoing bilateral tariff negotiations.
He stated that they’ve activated a contingency plan and they’re preparing for all scenarios – whether the Court rules the tariffs wholly unconstitutional, partially unconstitutional, or constitutional. He asked for understanding that he couldn’t disclose specific details of these plans.
The Trump administration is currently awaiting the Supreme Court’s final judgment on the legality of mutual tariffs imposed under the International Emergency Economic Powers Act (IEEPA). This law has been a key pressure tool in trade negotiations with South Korea, Japan, the European Union (EU), and others.
Analysts suggest that Trump’s threat to reimpose a 25% tariff on Korean goods is strategically timed. With the Supreme Court ruling expected around February 23, Trump appears to be pushing for visible U.S. investment commitments from Korea to create a favorable environment for the decision.
Coupang Issue Separate; Minister Explains U.S. Investment Delays Not Due to Korean Negligence
Kim firmly separated the renewed tariff threats from the recent Coupang controversy.
He clarified that the issues of U.S. investment and non-tariff barriers related to Coupang are distinct. President Trump’s social media comments seem to focus on the delay in passing our special law. He appears to be raising various issues comprehensively.
Kim also shared insights from his recent meetings with U.S. Commerce Secretary Gina Raimondo. Kim noted that Secretary Raimondo had some misunderstandings. She thought that after signing the memorandum of understanding (MOU) on strategic investment in November, it could proceed immediately in December. Kim explained the realities of the National Assembly’s budget review and hearing schedules.
He added that the Secretary wasn’t aware of the differences between Japan and Korea, where it needs legislation for certain investments. He clarified that this wasn’t due to Korean negligence. He also shared our bipartisan agreement to process the special law by March, which she seemed to appreciate.
Regarding the first U.S.-Korea strategic investment project, Kim was cautious. He said they’re discussing several options, but he wants to caution against speculation. They’re not focusing on any specific project at this time.
When asked about the repeatedly delayed’Korea-U.S. Free Trade Agreement (FTA) Joint Committee meeting, he simply stated it should occur within an appropriate timeframe.
Kim tactfully sidestepped a question about Foreign Minister Park Jin’s recent suggestion to transfer trade duties to the Foreign Ministry. He emphasized that right now, it needs to focus on resolving these issues together, regardless of departmental boundaries.
KCCI Fake News Controversy: Public Institutions Must Verify Facts Carefully
Kim also addressed the recent controversy surrounding a Korea Chamber of Commerce and Industry (KCCI) press release. He admitted that he was initially alarmed by reports suggesting wealthy individuals were leaving Korea due to inheritance taxes. He assumed KCCI was a credible source. However, it turned out the data came from an immigration consulting firm and didn’t even mention inheritance taxes.
That morning, the Ministry of Industry held an emergency meeting in Seoul, announcing an audit of the press release’s creation and potential legal action.
Kim clarified that this audit is about institutional oversight, not combating fake news.
He stressed that the public expects KCCI releases to be thoroughly vetted. When that doesn’t happen, it’s problematic. He’s urged all economic organizations to implement systems preventing incorrect citations. Kim expressed a sense of responsibility, adding that all public institutions, including his ministry, must be vigilant about not spreading unverified information.
He continued that he hopes this incident leads economic organizations to become more reliable and authoritative. It doesn’t want this controversy to discourage input from the business community, and it’ll work to ensure it doesn’t.
The Ministry of Industry promptly launched an audit into KCCI’s process for creating and distributing the controversial press release.
The issue stemmed from a KCCI release on February 3 titled, Analysis of Inheritance Tax Revenue Projections and Effects of Diversifying Payment Methods. It cited a study by British firm Henley & Partners, claiming 2,400 wealthy individuals left Korea last year – double the previous year and the fourth highest globally. The release faced immediate criticism for its unclear methodology and data sources.
President Lee Jae Myung weighed in on X (formerly Twitter), stating that deliberate misinformation that clouds public judgment on policy issues is a threat to democracy. He stressed the need for accountability and prevention of similar incidents.