logo
Industry minister nominee pushes Korean take on US Inflation Reduction Act

Industry minister nominee pushes Korean take on US Inflation Reduction Act

Korea Herald15-07-2025
Kim Jung-kwan calls for bold industrial policy to match US, China as tech rivalry intensifies
Kim Jung-kwan, the first nominee for industry minister under the Lee Jae Myung administration, has pledged to introduce a production-linked tax incentive system for key industries such as semiconductors and batteries, modeled after the US Inflation Reduction Act.
In a written response submitted to the National Assembly ahead of his confirmation hearing this week, Kim emphasized the need for aggressive government support that matches policies implemented by competing nations.
'It is time for strategic and proactive government-led industrial policies, including incentives that do not fall behind those of competing nations, in order to minimize trade risks,' Kim stated.
He noted that while semiconductors remain a core pillar of Korea's industrial and economic security, the country's leadership in memory chips is being challenged by Chinese and US firms, and its capabilities in logic chips remain relatively weak.
'We need bold semiconductor policies to strengthen our global leadership and stabilize our domestic manufacturing base,' Kim said, adding that tax and fiscal support for the sector will be expanded.
Addressing the battery sector, Kim acknowledged current difficulties stemming from a temporary slowdown in electric vehicle demand and the rapid rise of Chinese competitors. He said the government will consider introducing production tax credits for key minerals and materials to expand incentives for domestic manufacturing and strengthen the battery supply chain.
Kim's vision for production tax credits involves a system that offers tax deductions based on production volume, effectively functioning as subsidies linked to output. The US has implemented similar 'Advanced Manufacturing Production Credits' under the IRA to support strategic industries such as batteries, solar panels and clean fuels.
In Korea, companies operating in sectors designated as national strategic technologies, such as semiconductors and batteries, are currently eligible for one-time tax credits of up to 25 percent for facility and research and development investments. Unlike these investment-based incentives, Kim's proposed scheme would serve as a more direct benefit by offering tax credits on a portion of production costs.
If implemented, leading chipmakers Samsung Electronics and SK hynix are projected to receive annual tax reductions of between 4 trillion won and 5 trillion won ($2.9 billion and $3.6 billion).
President Lee had also pledged during his campaign to push for production tax credits of up to 10 percent for semiconductors. After taking office, he reportedly expanded the plan to include the battery sector, initiating internal reviews.
In his statement, Kim also vowed to expand the government budget for renewable energy.
'Expanding renewable energy is an urgent task for achieving carbon neutrality, enhancing energy security and creating new growth drivers,' he said, pledging to improve the overall environment for renewable energy deployment including identifying new project sites, securing grid connectivity and increasing public acceptance.
At the same time, Kim expressed support for nuclear energy, stressing the importance of a balanced energy mix of carbon-free sources to ensure a stable power supply and meet South Korea's greenhouse gas reduction targets under the Nationally Determined Contribution framework.
He also pledged to boost Korea's long-term technological competitiveness by developing Korean-style small modular reactors and next-generation nuclear fuels, while expanding exports of nuclear equipment and supporting small and mid-sized exporters in the sector.
On the issue of extended tariff negotiations with the US, set to conclude by Aug. 1, Kim said he would work toward a mutually beneficial outcome and use the talks as an opportunity to develop a bilateral manufacturing cooperation roadmap.
'In the face of US tariff measures and global supply chain shifts, I will do my utmost as Korea's 'export frontrunner' to strengthen our export competitiveness in key industries and open up new markets,' he said.
Kim, a former official at the Ministry of Economy and Finance, most recently served as head of marketing at Doosan Enerbility, a major power equipment builder. Since his nomination, he has divested all holdings in companies that could present potential conflicts of interest, including shares in Doosan.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

[Lee Kyong-hee] Fake news, false reports, conspiracy theories
[Lee Kyong-hee] Fake news, false reports, conspiracy theories

Korea Herald

timean hour ago

  • Korea Herald

[Lee Kyong-hee] Fake news, false reports, conspiracy theories

Within hours after President Yoon Suk Yeol declared martial law on Dec. 3, a rabid right-wing YouTuber contended that 99 Chinese spies were apprehended at an election management facility and transported to a US military base in Okinawa, Japan. Thereafter, social networks were rife with rumors that the Chinese accounted for 30 percent of anti-Yoon protesters demanding his impeachment. Nonsensical online demagoguery? Of course. But to many supporters of the disgraced YouTube-addicted former president, it rang true. After all, during his turbulent presidency, Yoon often blamed Chinese influence on domestic politics and elections without providing evidence. The Yoon supporters eventually descended on an enclave of lamb skewer restaurants mostly run by ethnic Koreans who left China for their ancestral homeland in search of better opportunities. Screams of 'Go back to China!' and 'Commies, disappear quickly from the Republic of Korea!' filled the air near Konkuk University, eastern Seoul. The pathetic scene of violence evoked a sense of deja vu. Rewind to July 1931, when Japan hyped a minor dispute between local Chinese farmers and Korean settlers in Manchuria to justify its aggression. The dispute began when a group of Koreans subleased land outside of Wanpaoshan village, north of Changchun, Jilin province, and began digging an irrigation ditch in an area not included in the sublease. Some 400 Chinese farmers, armed with farming tools, confronted the Koreans, and the Japanese consulate in Changchun dispatched police under the pretext of protecting subjects of their empire. The Chinese security authorities also sent police. The clash ended with several Chinese wounded, but Japanese police officers and Korean farmers unharmed. To ignite anti-Chinese sentiment, the Japanese colonial authorities had Korean newspapers publish fabricated reports claiming that hundreds of Koreans were killed during the so-called 'Wanpaoshan Incident.' Anti-Chinese riots erupted across Korea, causing hundreds of Chinese casualties and major property damage. Meanwhile, anti-Korean riots in China continued under Japan's wartime propaganda. Months later, a New York Times dispatch from Changchun dated Nov. 4 said: 'Fully 10,000 Korean farmers have been massacred by Chinese or slain while defending their homesteads during the last six weeks in Jilin Province alone, according to an estimate given out here today by a Japanese General commanding a division of 5,500 troops.' The media manipulation thus turned a minor skirmish between farming groups into a major conflict, devastating an ethnic community and eventually dealing a fatal blow to Korean independence movements in the broader Manchurian region. Fast forward to chaotic post-liberation Korea in 1945. Freed at last from four decades of harsh foreign rule, Koreans failed to achieve national unity and fell victim to great power politics. Again, newspapers played a role -- significant, if not decisive -- in the partition of the peninsula under two contesting regimes. In the summer of 1945, Koreans expected their country would quickly become free and independent again. They were not aware that the big powers, under US initiative, were considering a four-power trusteeship that might last as long as 40 to 50 years. The trusteeship issue was resolved by the foreign ministers of the US, the UK and the Soviet Union, who convened in Moscow in December 1945. Their communique, adopting the Soviet draft concerning the Korean question, stipulated a four-power trusteeship for up to five years to supervise a unified provisional Korean government, which would be established by a US-Soviet joint commission. On Christmas Day, before the announcement of the final decision, the United Press reported from Washington that 'Secretary of State Byrns went to Russia reportedly with instructions to urge immediate independence as opposed to the Russian thesis of trusteeship.' Korean media carried the story on Dec. 27, each editing and compiling it as they saw fit. The news bombarded the already polarized political scene. The idea of 'trusteeship' itself was unacceptable; anti-trusteeship became a strong rallying point for the right. The rightist Dong-A Ilbo had an inflammatory headline: 'Soviet Union Asserts Trusteeship; United States Asserts Immediate Independence.' The rightists seized upon the opportunity to denounce communists as 'country-selling Soviet stooges.' The US Military Government in Korea added to the confusion by deliberately implying that trusteeship was solely a Soviet policy. Amid extreme confrontation between the right and the left, leading politicians from both camps were assassinated. The turmoil ever deepened. The North-South division perpetuated. Much about the controversial newspaper reports on the Moscow conference, regarded as among the worst Korean press performances to date, remains a mystery. None of the newspapers offered an apology for false reporting, disregarding the basic principles of fact-checking and verification, nor did they elucidate the background of their reporting. Most recently, the press coverage of the visit by Morse Tan, a Korean American law professor and former US ambassador-at-large for global criminal justice, raises questions about his identity as well as evidence of his claims about election fraud in South Korea and President Lee Jae-myung's childhood. The press should focus more on fact-finding to enhance accountability and win back the public's trust, which has been lost to social media. Today's information disorder and consequent conundrum, complicated by the proliferation of new media and the ever-present foreign interference, requires unwavering journalistic integrity and professionalism. News consumers also need to improve their information literacy. Ultimately, they get the media they deserve.

Yoon's insurrection trial on hold as courts begin summer recess
Yoon's insurrection trial on hold as courts begin summer recess

Korea Herald

time17 hours ago

  • Korea Herald

Yoon's insurrection trial on hold as courts begin summer recess

Former President Yoon Suk Yeol's criminal insurrection trial over his short-lived martial law imposition, will be put on hold, as courts across the country begin a summer recess on Monday. The Seoul Central District Court, where Yoon's trial is being held, is scheduled to enter a two-week annual summer recess period from Monday to Aug. 8, a notice posted on its website showed Sunday. During this period, the court will have a reduced schedule for hearings. For all civil cases, hearings and preparatory and conciliation proceedings will be temporarily halted. Dates for criminal trials without detention and hearings and trials that 'do not have a significant impact on human rights' will not be held in the cited period. However, hearings on motions for provisional attachment or preliminary injunctions of civil cases, reviews of criminal trials for defendants held in custody, detention hearings before arrest and related reviews, will be carried out as scheduled during recess. Other trials and proceedings can also continue, if the court deems it necessary. Other courts nationwide will adopt similar rules during their respective summer recess period, which would take place around late July to mid-August. The Seoul Central District Court has so far held 12 hearings for Yoon's insurrection trial. Yoon has not attended his trial for three consecutive hearings, citing poor health. He is currently detained at the Seoul Detention Center in Uiwang, just south of the capital. After the two-week recess wraps-up, Yoon faces a separate trial at the Seoul Central District Court, over additional charges of abuse of power and violating the Presidential Records Act, tied to his martial law bid. The charges were brought by the special counsel team led by prosecutor Cho Eun-seok and the first preparatory hearing is scheduled for Aug. 19. The next hearings in the trials of Yoon's aides, including that of former Defense Minister Kim Yong-hyun, will not take place until mid-August. Kim has been charged with insurrection and abuse of power for deploying the military to the National Assembly in an unsuccessful attempt to block lawmakers from voting to overturn Yoon's martial law decree.

S. Korea's foreign population reaches all-time high of 2.73 million
S. Korea's foreign population reaches all-time high of 2.73 million

Korea Herald

time17 hours ago

  • Korea Herald

S. Korea's foreign population reaches all-time high of 2.73 million

South Korea's foreign population has reached an all-time high of more than 2.73 million, data showed Sunday. The number of foreign nationals staying in the country for purposes including education, employment or tourism stood at just under 2,733,000 as of the end of June, marking a 1.5 percent increase (40,068 people) from the previous month, according to data from the Korea Immigration Service under the Ministry of Justice. Of the total, some 1.55 million were long-term foreign residents staying 90 days or more, who registered personal information such as name, date of birth and purpose of stay with local immigration offices. Half of these registered foreigners were found to reside in Seoul and the surrounding metropolitan area. The Yeongnam region, which includes major cities such as Daegu, Busan and Ulsan, was home to 317,286 (20.3 percent), followed by 200,939 (12.9 percent) in the Chungcheong region and 136,990 (8.8 percent) in the Honam region. Another 552,000 of the total foreign resident population were overseas Koreans holding F-4 visas, who established a place of residence and reported it to their local immigration office, entitling them to rights similar to those of Korean citizens, such as opening bank accounts and enrolling in the national health insurance program. The remaining 620,000 foreign nationals were short-term visitors staying fewer than 90 days, most of whom were tourists. Chinese account for one in three The largest share of foreign residents was held by Chinese nationals with 972,176, accounting for 35.6 percent of the total. They were followed by Vietnamese (341,153), Americans (196,664), Thais (173,710) and Uzbeks (98,457). When categorized by visa type, F-4 visa holders, who are foreign nationals of Korean ancestry, represented the largest group, totaling 554,895. Following them were 341,453 foreign nationals on E-9 visas, issued under the Employment Permit System, which permits stays of up to three years. Launched in 2004, the temporary worker program allows small and mid-sized companies facing labor shortages to legally hire foreign workers for low-skilled jobs. F-5 permanent residency visa holders came next at 214,036, followed by 191,297 on D-2 student visas and 171,063 on B-2 tourist visas. By age, foreign residents in their 30s made up the largest segment at 25.7 percent, followed by those in their 20s (23.1 percent), 40s (16.7 percent), 60 and older (13.5 percent), 50s (12.3 percent) and under 19 (8.7 percent). The previous all-time high foreign population was recorded in 2019 at around 2.52 million, but the figure declined for two consecutive years amid the COVID-19 pandemic, falling to 2.04 million in 2020 and 1.96 million in 2021. But as COVID-19 reached the endemic stage, the figure rebounded to about 2.51 million in 2023 and rose further to 2.65 million last year. This year, the number peaked at 2.72 million in March, then dipped to 2.71 million in April and 2.69 million in May, before reaching a new record high of 2.73 million in June.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store