South Korea’s battery industry welcomed a two-year grace period for applying U.S. Foreign Entity of Concern (FEOC) regulations on graphite, a key uncertainty for its expansion in North America due to supply chain vulnerabilities. South Korea’s Ministry of Trade, Industry and Energy discussed the U.S. Inflation Reduction Act’s final guidelines on clean vehicle tax credits and FEOC provisions in a joint public-private meeting on Wednesday.

The government pledged to support the battery industry’s efforts to diversify key mineral supply chains and achieve independence, including providing $7.1 billion (9.7 trillion won) in policy financing for domestic investments this year. It also plans to assist companies in securing minerals from countries with U.S. free trade agreements and develop alternative technologies like lithium metal batteries.