South Korea’s commerce minister said on Monday that the US chip industry subsidy law imposes a number of onerous demands and still creates a great deal of uncertainty for companies hoping to benefit from it.
Li Changyang identified three main concerns regarding the Chip and Science Act, a $50 billion plan that includes incentives for foreign chipmakers to set up factories in the United States.
Some of his specific requirements were outlined last week, including childcare for workers and restrictions on investing in other countries or using money from the law to conduct share buybacks.
South Korea is home to two of the world’s largest memory chip makers, Samsung and SK Hynix, and Samsung already has a $17 billion factory under development in Texas.
The main obstacle for companies, Lee said, is uncertainty: There are many preconditions for receiving stimulus money and compliance will take a lot of time and effort. He also pointed to the challenges of requests for disclosure of management matters and the increase in the cost of investing in the United States due to high interest rates and inflation.
Lee said the Korean government will work closely with the United States to try to resolve various uncertainties arising from the law as well as addressing burdensome provisions for businesses.
The minister added that these problems can be significantly mitigated and resolved through negotiations between companies. He said Korea will also boost its support for the chip industry.
