South Korea’s trade ministry has responded to the Trump administration’s new trade policy wherein the company has imposed 25% tariff on advanced computing chips. The country’s trade minister has said that the tariffs will have a “limited impact” on the country’s tech giants – for now. According to news agency Reuters, South Korea’s Trade Minister Yeo Han-koo noted that since the current measures focus on logic chips rather than the memory chips that dominate South Korea’s exports, the immediate financial blow is cushioned.“Since the memory chips that South Korean companies mainly export are currently excluded, the immediate impact is expected to be limited,” Minister Yeo said. On January 14, President Donald Trump signed the order that specifically targets high-end AI processors like Nvidia’s H200 and AMD’s MI325X.The White House, nevertheless, has also exempted for US data centers, startups and civil industrial applications to prevent a total shock to the American AI sector. However, Yeo warned that “it is not yet time to be reassured,” citing the looming threat of a “Phase 2” expansion that could eventually pull more general-purpose semiconductors into the tariff net.
US Commerce Secretary Howard Lutnick warns of ‘100% tariff’
Meanwhile, US Commerce Secretary Howard Lutnick issued a stark ultimatum to foreign manufacturers, that in sharp contrast with South Korea’s optimism. Speaking at a Micron plant groundbreaking in New York, Lutnick said that South Korean and Taiwanese chipmakers who fail to invest in American-based production could face tariffs as high as 100%.The strategy is reportedly a part of a broader Section 232 investigation aimed at incentivising domestic manufacturing and reducing reliance on the East Asian supply chain. While Samsung and SK Hynix have already committed billions to US facilities, the threat of 100% duties serves as a high-pressure tactic to ensure those commitments are accelerated.The report added that the South Korean government confirmed it is working “closely with industry” to navigate these shifting benchmarks that are designed to penalise companies that keep their most advanced production lines on foreign soil.
