{"id":2205032,"date":"2024-05-09T08:00:00","date_gmt":"2024-05-08T23:00:00","guid":{"rendered":"https:\/\/koreapro.org\/?p=2205032"},"modified":"2024-05-08T15:44:59","modified_gmt":"2024-05-08T06:44:59","slug":"south-korea-pledges-7-1-billion-to-help-battery-makers-reduce-china-dependence","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2024\/05\/south-korea-pledges-7-1-billion-to-help-battery-makers-reduce-china-dependence\/","title":{"rendered":"South Korea pledges $7.1 billion to help battery makers reduce China dependence"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">South Korea\u2019s 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\u2019s Ministry of Trade, Industry and Energy <\/span><a href=\"https:\/\/www.motie.go.kr\/kor\/article\/ATCL3f49a5a8c\/169011\/view?mno=&amp;pageIndex=1&amp;rowPageC=0&amp;displayAuthor=&amp;searchCategory=0&amp;schClear=on&amp;startDtD=&amp;endDtD=&amp;searchCondition=1&amp;searchKeyword=#\"><span style=\"font-weight: 400;\">discussed<\/span><\/a><span style=\"font-weight: 400;\"> the U.S. Inflation Reduction Act\u2019s final guidelines on clean vehicle tax credits and FEOC provisions in a joint public-private meeting on Wednesday.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The government pledged to support the battery industry\u2019s 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.<\/span><\/p>\n<p><b>Why It Matters<\/b><\/p>\n<p><span style=\"font-weight: 400;\">The two-year grace period for FEOC regulations on graphite is crucial for South Korea\u2019s battery industry. The country\u2019s <\/span><a href=\"https:\/\/koreapro.org\/2023\/10\/seoul-grapples-with-beijings-graphite-export-control-battery-industry-at-risk\/\"><span style=\"font-weight: 400;\">imports<\/span><\/a><span style=\"font-weight: 400;\"> of synthetic and natural graphite amounted to $241 million in 2022, with China accounting for 93.7% of the volume. Graphite is a key component in lithium-ion batteries, and the $7.1 billion government assistance aims to help the industry diversify its supply chains away from China.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">South Korea\u2019s major battery firms, LG Energy Solution, SK On and Samsung SDI Company, have been expanding battery production at their <\/span><a href=\"https:\/\/en.yna.co.kr\/view\/AEN20240204001200320\"><span style=\"font-weight: 400;\">overseas plants<\/span><\/a><span style=\"font-weight: 400;\"> in the U.S. and Europe to benefit from local tax benefits and adhere to their environmental, social, and governance (ESG) regulations. It remains to be seen whether the pledged subsidies will be sufficient for these companies to reshore production, given the intense global competition and South Korea\u2019s aging workforce.<\/span><\/p>\n<div class=\"content-tags\"><a href=\"https:\/\/koreapro.org\/tag\/business-economy\/\"><span class=\"tag\">Business &amp; Economy<\/span><\/a><a href=\"https:\/\/koreapro.org\/tag\/inter-korean-foreign-relations\/\"><span class=\"tag\">Inter-Korean &amp; Foreign Relations<\/span><\/a><a href=\"https:\/\/koreapro.org\/tag\/technology-cyber\/\"><span class=\"tag\">Technology &amp; Cyber<\/span><\/a><\/div>","protected":false},"excerpt":{"rendered":"<p>South Korea\u2019s 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\u2019s Ministry of Trade, Industry and Energy discussed the U.S. Inflation Reduction Act\u2019s final guidelines on clean vehicle tax credits [&hellip;]<\/p>\n","protected":false},"author":10407,"featured_media":2205033,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[30],"tags":[24,28,29],"class_list":["post-2205032","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-briefings","tag-business-economy","tag-inter-korean-foreign-relations","tag-technology-cyber"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v23.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>South Korea pledges $7.1 billion to help battery makers reduce China dependence - KOREA PRO<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/koreapro.org\/2024\/05\/south-korea-pledges-7-1-billion-to-help-battery-makers-reduce-china-dependence\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"South Korea pledges $7.1 billion to help battery makers reduce China dependence - KOREA PRO\" \/>\n<meta property=\"og:description\" content=\"South Korea\u2019s 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. 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