{"id":2207009,"date":"2024-11-01T17:01:15","date_gmt":"2024-11-01T08:01:15","guid":{"rendered":"https:\/\/koreapro.org\/?p=2207009"},"modified":"2024-11-04T17:31:53","modified_gmt":"2024-11-04T08:31:53","slug":"what-a-harris-presidency-could-mean-for-south-koreas-economic-and-security-ties","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2024\/11\/what-a-harris-presidency-could-mean-for-south-koreas-economic-and-security-ties\/","title":{"rendered":"What a Harris presidency could mean for South Korea\u2019s economic and security ties"},"content":{"rendered":"

With the U.S. presidential election just days away, the potential for a Kamala Harris win poses both risks and opportunities for South Korea.<\/span><\/p>\n

Harris\u2019 record as vice president, particularly her role in shaping policies such as the <\/span>Inflation Reduction Act<\/span><\/a> (IRA), <\/span>CHIPS and Science Act<\/span><\/a> and the <\/span>Indo-Pacific Economic Framework<\/span><\/a> (IPEF), suggests that she strongly aligns with current U.S. priorities like reshoring production, prioritizing national security in trade and encouraging clean energy investments.<\/span><\/p>\n

Should Harris beat former President Donald Trump, South Korea will have to capitalize on partnership opportunities that have already been laid out by the Biden administration, while adapting to evolving trade and economic demands, security expectations and environmental standards.<\/span><\/p>\n

ECONOMIC AND TRADE POLICIES<\/b><\/p>\n

Continuation of Biden-era Protectionism<\/span><\/i><\/p>\n

A Harris administration will likely uphold the Biden administration\u2019s protectionist trade and economic approach, which has roots in <\/span>Trump-era policies<\/span><\/a>. The IRA and CHIPS Act epitomize this approach, prioritizing domestic production and job creation over traditional free trade principles.<\/span><\/p>\n

Harris\u2019 policies would likely favor U.S. manufacturing, which could create competitive challenges for South Korean companies, particularly in the high-tech and automotive sectors. To benefit from IRA subsidies, South Korean electric vehicle (EV) and battery manufacturers like Hyundai, Kia and LG Chem will likely have to continue to <\/span>localize more of their production in the U.S.<\/span><\/a><\/p>\n

The potential continuation of Biden-era policies raises the question of how South Korea, a proponent of open trade, can reconcile its export-driven economy with the U.S.\u2019 continued shift toward economic protectionism.\u00a0<\/span><\/p>\n

For South Korea, it may become increasingly important to advocate for a U.S. pivot back toward global free trade, emphasizing mutually beneficial trade over restrictive policies.<\/span><\/p>\n

\"\"

U.S. President Joe Biden and Vice President Kamala Harris promote the benefits of the Inflation Reduction Act, Oct. 25, 2024 | Image: Vice President of the United States via Twitter<\/a><\/em><\/p><\/div>\n

Challenges of Export Restrictions<\/span><\/i><\/p>\n

With a potential Harris administration likely continuing Biden\u2019s emphasis on equating economic security with national security, the U.S. <\/span>\u201cde-risking\u201d strategy<\/span><\/a> with China would remain a cornerstone of U.S. trade policy, affecting South Korea\u2019s balancing act with both nations.<\/span><\/p>\n

Although Harris would likely avoid full decoupling from Beijing, her administration would likely reinforce current <\/span>restrictions on technology exports<\/span><\/a> to China, impacting industries critical to South Korea.<\/span><\/p>\n

For example, semiconductor manufacturers Samsung and SK Hynix, which have invested billions in Chinese production facilities, would face rising compliance costs and significant opportunity costs.<\/span><\/p>\n

The CHIPS Act alone allocates <\/span>$52.7 billion<\/span><\/a> to develop domestic semiconductor manufacturing and restricts companies receiving subsidies from expanding chip production in China for a <\/span>decade<\/span><\/a>.<\/span><\/p>\n

This strategy, while beneficial for the U.S., poses risks for South Korean companies that rely on Chinese manufacturing to maintain competitiveness. Restrictive U.S. export policies could limit South Korean companies\u2019 ability to develop cutting-edge technology and put pressure on Seoul to align more closely with Washington\u2019s policies at the cost of its Chinese partnerships.<\/span><\/p>\n

IPEF and Regional Trade Integration<\/span><\/i><\/p>\n

IPEF, launched in May 2022, was designed to boost Indo-Pacific trade and supply chain resilience, and South Korea has been an active participant.<\/span><\/p>\n

However, Gordon Flake, CEO of the Perth USAsia Centre, described it as \u201cfour pillars but no roof or walls,\u201d pointing to its lack of cohesion and practical application.<\/span><\/p>\n

IPEF\u2019s <\/span>four pillars<\/span><\/a> \u2014 trade, supply chains, clean economy and fair economy \u2014 represent key areas of regional cooperation but lack the binding structure seen in traditional trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).<\/span><\/p>\n

Unlike the CPTPP, which offers clear incentives like <\/span>tariff reductions and improved market access<\/span><\/a>, IPEF <\/span>does not provide<\/span><\/a> member nations with such benefits. This absence limits the framework\u2019s impact on South Korea\u2019s economy, as tariff reductions and expanded access to U.S. markets are essential for tangible trade benefits.<\/span><\/p>\n

Without these incentives, South Korea\u2019s participation has been more focused on emphasizing Seoul\u2019s alignment with Washington. A Harris administration would likely maintain this dynamic, preventing South Korea from fully leveraging IPEF to enhance trade and investment.<\/span><\/p>\n

Still, IPEF offers opportunities for South Korea, particularly in terms of supply chain collaboration and clean economy initiatives.<\/span><\/p>\n

As the U.S. and South Korea align on supply chain security and technology standards, this cooperation could boost South Korea\u2019s standing in the Indo-Pacific, allowing it to play a more active role in <\/span>boosting supply chain resilience<\/span><\/a> for like minded countries.<\/span><\/p>\n

However, without substantive economic incentives, IPEF\u2019s benefits will continue to remain limited.<\/span><\/p>\n

\"\"

U.S. Vice President Kamala Harris looks over the Demilitarized Zone, Sept. 30, 2022 | Image: Vice President of the United States via Twitter<\/a><\/em><\/p><\/div>\n

DEFENSE AND SECURITY<\/b><\/p>\n

The Biden administration has focused on deepening the U.S.-ROK alliance after the <\/span>rocky years<\/span><\/a> of the Trump administration.<\/span><\/p>\n

Over the past four years, there have been numerous joint military exercises between the two countries, and, most significantly, the U.S. reinforced its commitment to the alliance via the <\/span>Washington Declaration<\/span><\/a>, which resulted in the establishment of the Nuclear Consultative Group.<\/span><\/p>\n

With North Korea\u2019s latest <\/span>intercontinental ballistic missile test<\/span><\/a> and growing cooperation between <\/span>Pyongyang and Moscow<\/span><\/a>, a Harris presidency would likely continue Biden\u2019s proactive defense policy with South Korea, focusing on deterrence.<\/span><\/p>\n

Further, <\/span>trilateral security cooperation<\/span><\/a> among the U.S., South Korea and Japan will likely strengthen for the foreseeable future, offering South Korea enhanced strategic benefits. Increased trilateral cooperation will likely help South Korea counterbalance North Korea\u2019s growing military capabilities and assertiveness in the region.<\/span><\/p>\n

Moreover, South Korea\u2019s defense sector may find more <\/span>export opportunities<\/span><\/a> to U.S.-aligned countries under a Harris administration.<\/span><\/p>\n

Further, Hanwha Ocean announced in August that it had secured a <\/span>maintenance, repair and overhaul contract<\/span><\/a> with the U.S. Navy, marking the first time a South Korean shipyard has achieved such an agreement. This milestone opens new avenues for South Korea\u2019s defense industry to engage in U.S. military projects.<\/span><\/p>\n

Such partnerships could enhance South Korea\u2019s defense sector\u2019s credibility and competitiveness in the global market, aligning with U.S. strategic interests and potentially leading to further opportunities in defense exports and collaborations.<\/span><\/p>\n

TECHNOLOGICAL AND INDUSTRIAL POLICIES<\/b><\/p>\n

A Harris administration would likely maintain the Biden administration\u2019s enforcement of <\/span>stringent AI and cybersecurity standards<\/span><\/a>, posing significant compliance hurdles for South Korean tech firms aiming to access or expand in the U.S. market.<\/span><\/p>\n

Harris\u2019 track record as an advocate for AI safety and robust cybersecurity suggests that her administration would prioritize high standards for data protection, especially in sectors critical to national security.<\/span><\/p>\n

South Korea\u2019s vulnerability to cyber threats \u2014 evidenced by <\/span>military technology leaks<\/span><\/a>, incidents of <\/span>industrial espionage<\/span><\/a> and a history of <\/span>hacking attacks<\/span><\/a> \u2014 highlights the challenges South Korean firms may face in aligning with U.S. cybersecurity expectations.<\/span><\/p>\n

Cybersecurity challenges are particularly relevant as South Korea seeks deeper integration into U.S.-led security frameworks like AUKUS, which emphasizes defense technology and security cooperation among Australia, the U.K. and the U.S.<\/span><\/p>\n

While <\/span>AUKUS Pillar 2<\/span><\/a> focuses on advanced technological collaboration, including AI and cybersecurity, South Korea\u2019s inclusion has faced obstacles, largely due to its track record on data security and industrial espionage incidents.<\/span><\/p>\n

Despite these challenges, Harris\u2019s policies could still open pathways for South Korea to collaborate with the U.S. on AI, semiconductor technology and telecommunications, albeit under more rigorous security protocols.<\/span><\/p>\n

For example, the U.S. and South Korea could enhance joint research and development initiatives through IPEF\u2019s supply chain and technology pillars, strengthening South Korea\u2019s role in the Indo-Pacific.<\/span><\/p>\n

\"\"

ROK President Yoon Suk-yeol and U.S. Vice President Kamala Harris give a joint address at NASA\u2019s Goddard Space Flight Center to discuss space cooperation, April 26, 2023 | Image: Vice President of the United States via Twitter<\/a><\/em><\/p><\/div>\n

NUCLEAR ENERGY AND EXPORT CHALLENGES<\/b><\/p>\n

Support for Nuclear Power<\/span><\/i><\/p>\n

Given Harris\u2019 <\/span>support for nuclear energy<\/span><\/a> as part of a clean energy transition, the U.S.-South Korea partnership on nuclear power could see substantial growth under her administration. The Biden administration\u2019s <\/span>$1.5 billion loan<\/span><\/a> to Michigan for nuclear plant development in March demonstrates a pro-nuclear stance that Harris will likely continue, creating significant opportunities for collaboration.<\/span><\/p>\n

For instance, South Korea has been advancing its <\/span>Small Modular Reactor<\/span><\/a> (SMR) technology, with firms like Korea Hydro and Nuclear Power (KHNP) developing compact and versatile reactors suited for both domestic and export markets.<\/span><\/p>\n

Under a Harris administration, South Korea could <\/span>continue to collaborate with the U.S.<\/span><\/a> to co-develop SMR technology tailored for diverse applications, including power generation in remote or off-grid locations and industrial power solutions.<\/span><\/p>\n

Joint ventures or technology-sharing agreements could help both countries leverage their expertise, with the U.S. offering extensive research facilities and regulatory frameworks, and South Korea contributing its engineering advancements and cost-effective manufacturing.<\/span><\/p>\n

This partnership could further establish South Korea as a global leader in nuclear energy, expanding its export potential to countries pursuing clean and flexible nuclear solutions.\u00a0<\/span><\/p>\n

Additionally, shared standards and joint certification processes between the U.S. and South Korea could ease regulatory barriers for future SMR exports, positioning both nations to meet rising global demand for sustainable nuclear options.<\/span><\/p>\n

Challenges to Nuclear Export Ambitions<\/span><\/i><\/p>\n

At the same time, Harris\u2019 emphasis on regulatory compliance could impact South Korea\u2019s nuclear export ambitions, especially if U.S. intellectual property laws delay deals, as seen with South Korea\u2019s Czech Republic project.<\/span><\/p>\n

The Czech anti-monopoly office issued a provisional measure <\/span>temporarily halting<\/span><\/a> KHNP\u2019s contract to build a nuclear power plant in the Central European country following legal complaints from Westinghouse Electric (U.S.) and EDF (France). Westinghouse asserts that KHNP\u2019s reactor tech infringes on its intellectual property rights and that the South Korean company cannot use its reactor technology without U.S. authorization.<\/span><\/p>\n

Collaborative U.S.-South Korean nuclear projects could help by fostering joint R&D, shared standards and joint IP frameworks. However, until the U.S.-South Korea intellectual property dispute over nuclear technology is resolved, Seoul\u2019s ambitions for Europe remain constrained.<\/span><\/p>\n

For South Korea, which views nuclear exports as integral to its energy strategy, the Czech project is a critical test case. A successful resolution could elevate South Korea\u2019s profile as the EU transitions away from Russian energy.<\/span><\/p>\n

However, considering Harris\u2019 track record in supporting U.S. businesses and their interests, it remains to be seen whether a Harris administration would be cooperative in this regard.<\/span><\/p>\n

HARRIS AND KOREA<\/b><\/p>\n

Ultimately, a Harris presidency presents a mix of risks and opportunities for South Korea.\u00a0<\/span><\/p>\n

While Harris\u2019 policies on protectionism and tech restrictions could challenge South Korean exports, there would be opportunities for robust economic and defense cooperation and joint technological projects.<\/span><\/p>\n

U.S. allies like South Korea may need to encourage Washington to adopt a more open trade policy, advocating for a balanced alliance that supports both nations\u2019 economic and strategic goals.<\/span><\/p>\n

Edited by Alannah Hill<\/span><\/i><\/p>\n

Business & Economy<\/span><\/a>Defense & Security<\/span><\/a>Inter-Korean & Foreign Relations<\/span><\/a>Technology & Cyber<\/span><\/a><\/div>","protected":false},"excerpt":{"rendered":"

With the U.S. presidential election just days away, the potential for a Kamala Harris win poses both risks and opportunities for South Korea. Harris\u2019 record as vice president, particularly her role in shaping policies such as the Inflation Reduction Act (IRA), CHIPS and Science Act and the Indo-Pacific Economic Framework (IPEF), suggests that she strongly […]<\/p>\n","protected":false},"author":10407,"featured_media":2207010,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[24,26,28,29],"class_list":["post-2207009","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","tag-business-economy","tag-defense-security","tag-inter-korean-foreign-relations","tag-technology-cyber"],"yoast_head":"\nWhat a Harris presidency could mean for South Korea\u2019s economic and security ties - 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\/11\/what-a-harris-presidency-could-mean-for-south-koreas-economic-and-security-ties\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What a Harris presidency could mean for South Korea\u2019s economic and security ties - KOREA PRO\" \/>\n<meta property=\"og:description\" content=\"With the U.S. presidential election just days away, the potential for a Kamala Harris win poses both risks and opportunities for South Korea. 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