“It’s difficult, but I’ll do my best”… Conveying concerns to the U.S. and seeking solutions
In relation to the exclusion of Korean electric vehicles from the subsidy for electric vehicles in the United States due to the enactment of the Inflation Reduction Act (IRA) in the United States, the Korean government has dispatched a delegation to discuss this issue with the United States.
A joint government delegation composed of Ahn Sung-il, head of the Ministry of Trade, Industry and Energy’s new trade and order strategy office, Sohn Woong-gi, head of the current trade affairs team at the Ministry of Strategy and Finance, and Lee Mi-yeon, director of the bilateral economy and foreign affairs bureau of the Ministry of Foreign Affairs, arrived at Dulles International Airport in Washington DC on the 29th (local time).
The delegation will stay in Washington DC until the 31st and meet officials from relevant ministries such as the U.S. Trade Representative (USTR), the Treasury, and the Ministry of Commerce and members of Congress to convey the Korean government’s position and concerns regarding the US electric vehicle subsidy system and to discuss supplementary measures. to be.
Ahn met with reporters at the airport and said, “I plan to convey the government’s concerns and the position of Korean companies regarding the (US) electric vehicle subsidy system.”
The IRA, signed by President Joe Biden on Monday, offers up to $7,500 in tax credits to electric vehicle buyers, limiting them to consumers who purchase final assembled electric vehicles in North America.
According to this law, all electric vehicles currently sold by Hyundai Motor Group in the United States are made and exported in Korea, so they are not included in the subsidy.
In fact, among the 31 North American assembled electric vehicle models for 2022-2023 announced by the U.S. Department of Energy on the 16th, none of the vehicles were produced by Hyundai or Kia.
The government believes that such discrimination is highly likely to violate the principles of national treatment and most-favoured country treatment of the Korea-US Free Trade Agreement (FTA) and the World Trade Organization (WTO).
National treatment is a basic principle of the international trade system that goods imported from abroad should be treated on an equal basis with domestic products, and most-favored country treatment should be treated no less favorably than conditions accorded to other countries.
It is known that the government is in a position to amend the law so that it does not disadvantage Korean companies or to provide relief to Korean companies, but there are observations that it is not easy to reflect this as the law is already in effect.
The Joe Biden administration is promoting the IRA as a representative legislative achievement ahead of the November midterm elections.
USTR President Catherine Ty issued a statement shortly following the House passed the IRA, calling it “a historic achievement that will create high-paying jobs and advance American leadership in the development of cutting-edge clean energy technologies.”
U.S. government officials who recently met with lawmakers from the ruling and opposition parties who visited Washington DC were also reported to have fully understood the South Korean government’s position, but maintained a principled stance that “there is no solution right now and the administration cannot control the Congress.”
Ahn said, “The circumstances are difficult, but we will do our best.”
When asked if they would discuss whether to sue the United States for violating the WTO, he answered, “It seems like a matter that should be discussed with the United States first.”
When asked whether the government was responding too late, he explained, “(The law) was suddenly announced, and not only us, but also other countries were not aware of it, and I know that we are responding the fastest.”
Following the visit of the working group, Ahn Deok-geun, the head of trade negotiations, will visit the United States next week to attend the Indo-Pacific Economic Framework (IPEF) Ministerial Meeting to continue high-level discussions with the US on the IRA.
/yunhap news
