US chip tax threatens to render meaningless South Korea’s $350B trade deal



Analysis US chip tax threatens to render meaningless South Korea’s $350B trade deal Proposed trade controls on imported electronics show no agreement can restrain Trump administration’s protectionism John LeeSeptember 29, 2025 SHARE COPY LINK FACEBOOK X LINKEDIN MASTODON ROK President Lee Jae-myung meets with U.S. Treasury Secretary Scott Bessent, Sept. 25, 2025 \| Image: ROK Presidential Office Washington’s reported plan to tax imported electronics by the value of their semiconductor content could soon render South Korea’s $350 billion investment-for-tariff relief deal effectively meaningless, exposing the country’s chip-heavy export economy to fresh risk. The proposed tax shows that the U.S. can and will impose new trade barriers even after promising to cut tariffs, a signal that the Trump administration will continue to use tariffs for leverage in its increasingly transactional approach to foreign policy. What this means is that Seoul cannot count on Washington’s trade commitments despite its heavy reliance on the American market, forcing it to figure © Korea Risk Group. All rights reserved. No part of this content may be reproduced, distributed, or used for commercial purposes without prior written permission from Korea Risk Group. LATEST ANALYSIS 01Lee Jae Myung’s ‘pacemaker’ strategy tests South Korea’s leverage with Trump 02Trump’s Korea investment victory lap masks safeguards Seoul still controls 03North Korean POW dispute tests Seoul-Kyiv trust and future Ukraine policy 04South Korea’s CPTPP push exposes the cost of turning trade gains into consensus 05AI storage boom gives South Korea battery makers an EV overcapacity lifeline 06South Korea’s Mexico strategy runs into the hard limits of USMCA politics 07Preschool test ban forces South Korea’s English hagwons to rethink placement 08Lee Jae Myung’s Wall Street pitch tests South Korea’s capital market credibility

Analysis

US chip tax threatens to render meaningless South Korea’s $350B trade deal

Proposed trade controls on imported electronics show no agreement can restrain Trump administration’s protectionism

John LeeSeptember 29, 2025

US chip tax threatens to render meaningless South Korea’s $350B trade deal

ROK President Lee Jae-myung meets with U.S. Treasury Secretary Scott Bessent, Sept. 25, 2025 | Image: ROK Presidential Office

Washington’s reported plan to tax imported electronics by the value of their semiconductor content could soon render South Korea’s $350 billion investment-for-tariff relief deal effectively meaningless, exposing the country’s chip-heavy export economy to fresh risk.

The proposed tax shows that the U.S. can and will impose new trade barriers even after promising to cut tariffs, a signal that the Trump administration will continue to use tariffs for leverage in its increasingly transactional approach to foreign policy.

What this means is that Seoul cannot count on Washington’s trade commitments despite its heavy reliance on the American market, forcing it to figure

US chip tax threatens to render meaningless South Korea’s $350B trade deal

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John Lee