Ministry of Trade, Industry and Energy

IPEF Supply Chain Agreement to take effect April 17 in Korea

The Ministry of Trade, Industry and Energy (MOTIE) announced on April 12 that the Indo-Pacific Economic Framework for Prosperity (IPEF) Supply Chain Agreement will come into effect on April 17 in Korea.   Korea submitted its ratification documents on March 18, 2024, and the Agreement will enter into force after a 30-day period, on Wednesday, April 17. For the U.S., Japan, Singapore, Fiji, and India, the Supply Chain Agreement has taken effect as of February 24 this year; Korea will be the sixth country to ratify the said agreement.   As the first multilateral international agreement on supply chains, the IPEF Supply Chain Agreement is anticipated to contribute to establishing a more stable intraregional supply chain. During times of non-crisis, the 14 partner countries will cooperate to increase investment, enhance logistics, and push joint R&D projects for building supply chain resiliency. During crises, partner countries will be running a “Crisis Response Network” by which they can carry out joint response measures. date2024-04-12

Korea's automobile exports hit all-time high of $17.5 bln for Q1 in 2024

The Ministry of Trade, Industry and Energy (MOTIE) announced on April 11 that Korea’s automobile exports hit all-time highs of USD 17.5 billion (up 2.7 percent year-on-year) for the first quarter of 2024 (January-March in acc.). The monthly export value reached $6.2 billion in March, making a quick rebound since the setback to $5.2 billion in February.   The key takeaway for March exports and domestic sales is the steep rise of hybrid vehicles (PHEVs excluded), advancing 37 percent to a record-breaking $0.9 billion. With the domestic market also selling 40,000 units (up 24 percent) in March, strong domestic and overseas demand for hybrid cars is expected to serve as a stable source of workload for the parts industry.   Automobile production in March amounted to 365,497 units (down 10.8 percent), surpassing last year’s monthly average (app. 354,000 units) and recording the highest among the first three months of this year. The year-on-year downtick in production is attributable to the lower number of working days (-1.5) and a major automaker’s production line renovation for future mobility transition.   Domestic sales in March added up to 146,019 units (down 12.0 percent). Meanwhile, hybrid cars (up 24 percent) and EVs (up 16 percent) posted double-digit growth, boosting the sales of eco-friendly vehicles 18.6 percent to 61,435 units, surpassing the previous all-time monthly high of approximately 58,000 units set in November 2023. date2024-04-11

Minister Ahn visits Washington D.C. to discuss stronger Korea-U.S. cooperation in clean energy and advanced industries

Trade, Industry and Energy Minister Dukgeun Ahn is making his first visit to Washington D.C., U.S. (April 10-12) after taking office to meet with U.S. Department of Commerce (DOC) and Department of Energy (DOE) counterparts, Biden administration officials, U.S. Congress members, and major thinktank figures for extensive discussions on trade issues and measures for Korea-U.S. cooperation in industries and energy.   During the bilateral ministerial Supply Chain and Commercial Dialogue (SCCD) meeting and energy ministerial meeting held in April 2023 on the margins of President Yoon Suk Yeol’s state visit to the U.S., the two countries agreed to cooperate in clean energy and advanced industries, including semiconductors. Minister Ahn aims to further discussions on stronger cooperation in clean energy areas and advanced industries through this visit, while also touching on issues concerning the U.S. CHIPS Act subsidies and the Inflation Reduction Act (IRA) incentives.   Moreover, he will meet with representatives of Korean firms operating in the local U.S. market to cover investment issues and seek business support measures with Congress members. With key thinktank figures, he plans to exchange views on forward-looking measures for developing and deepening Korea-U.S. relations.   Minister Ahn remarked that “The Korea-U.S. alliance has grown closer than ever, advancing to one of economic security, advanced industries, and supply chains,” and that efforts will be made to bolster bilateral ties through continued cooperation with the U.S. DOC, DOE, and other divisions. date2024-04-11

Ministries and companies discuss pending chip issues at presidential office

Trade, Industry and Energy Minister Dukgeun Ahn attended a meeting chaired by President Yoon Suk Yeol on April 9 at the Office of the President in Yongsan, Seoul, held for discussions on global chip supply chain risk factors in view of the recent earthquake in Taiwan, and for President Yoon to first-handedly assess the measures for the swift establishment of semiconductor mega clusters.   Attending the meeting were representatives of relevant ministries and companies, including the Ministry of Economy and Finance (MOEF), Ministry of Science and ICT (MSIT), Ministry of Land, Infrastructure and Transport (MOLIT), Ministry of Environment (ME), Samsung Electronics, SK Hynix, SAPEON Korea, and Naver.   Attendees discussed measures for securing the semiconductor technology super gap in the global race on AI chips, and the future direction for Korea in pushing the AI chip initiative.   Regarding the Taiwan earthquake and global supply chain risk factors, the meeting concluded that impact on Korean companies is limited at present, but efforts will continue to be made to monitor the supply chain situation with related industries and associations to handle uncertainties.   Discussions also covered the following measures for a swift establishment of the semiconductor mega clusters.   First, the Government plans to back the establishment of infrastructure and accelerate corporate investment, raising the state funding rate from the previous 5-30 percent to 15-30 percent. For the Yongin System Semiconductor Cluster, in which Samsung Electronics plans to invest 360 trillion won by 2047, the site renovation period is to be substantially shortened by utilizing the preliminary consultation system for environmental impact evaluation and through prompt land compensation.    The Government will also push for stronger investment incentives by extending the national strategic technology investment tax credit incentive due to sunset at the end of this year, which currently grants a 25 percent maximum tax credit.   The second aim is to nurture professional talent and create a better working environment. This will entail a further designation of chip-focused specialization universities (10) and graduate schools (3), as well as the establishment of new cities and public housing around the semiconductor industrial clusters and laying of a “chip highway” connecting the clusters in Hwaseong, Yongin and Anseong. Plans also include rolling out a global talent package for attracting overseas talents into Korea by supporting their immigration and housing.   Third, support will go towards the early establishment of a mass-production demonstration testbed (Yongin Semiconductor Cluster mini fab) for facilitating cooperation between chip MPE (materials, parts, equipment) firms and chip manufacturers, and towards the production of ultra fine process prototypes. The chip performance testing and inspection service is to be initiated starting this year with the establishment of the inspection support center.   In this AI era, there still exists sustainability issues owing to performance and energy costs, and the outlook is that the future of AI competitiveness will center on AI chips and hardware innovation, as well as the organic collaboration among AI models.   In this regard, Korea will be launching the AI Chip Initiative based on the following nine technological innovations: next-generation general-purpose AI (AGI); lightweight and low-power AI; AI safety technology development; processing in memory (PIM); low-power K-AP; new device & advanced packaging; AI supercomputing; on-device AI; and next-generation open AI architecture software.   MOTIE and MSIT will be holding review sessions on a regular basis and share collaboration cases and outcomes with related institutions to minimize d date2024-04-09

Korea and U.S. to use eCERT for steel customs clearance

The Ministry of Trade, Industry and Energy (MOTIE) and the Korea Customs Service (KCS) announced that the U.S. is introducing the Electronic Certification System (eCERT) as a new filing system for quota-subject Korean steel. U.S. Customs and Border Protection (CBP) has notified the above on the Federal Register on April 5 (local time).   The eCERT is CBP's new electronic document system for managing quotas and customs, and is anticipated to prevent illegal transactions, save time in information handling, and increase stability.   The system will run in tandem with the Korea Iron and Steel Association (KOSA)’s export quota management system. CBP will compare and cross-check the export approval document submitted by KOSA with the import declaration form and reply back on whether or not to approve customs clearance.   According to the Federal Register notice, the grace period for the new filing system takes effect April 22, 2024, and CBP will automatically reject filings without correct eCERT information beginning May 20, 2024. date2024-04-08

Six global institutions selected for Global Industry and Technology Cooperation Center project

Trade, Industry and Energy Minister Dukgeun Ahn held the Global Open Innovation Strategy Conference on April 5 at Josun Palace and announced the preferred bidders for the Global Industry and Technology Cooperation Center project.   The Global Industry and Technology Cooperation Centers are to be a platform for international joint R&D projects, partner matching, and technology collaboration, for which 30 universities and research institutes around the world applied. Paper and presentation evaluation rounds narrowed the applicants down to six overseas institutions, namely Massachusetts Institute of Technology (MIT), Yale University, Purdue University, Johns Hopkins University, Fraunhofer, and Georgia Institute of Technology.   The Ministry of Trade, Industry and Energy plans to launch around 45 joint global R&D projects this year with aim to secure 100 next-generation foundational technologies by 2028. date2024-04-05

MOTIE to support innovative SMEs with KRW 16.6 tln technology financing by 2028

Trade, Industry and Energy Minister Dukgeun Ahn attended the Technology Financing Investment Promotion Strategy Meeting on April 4 at Lotte Hotel Seoul and announced private-led technology financing promotion measures on providing KRW 16.6 trillion to SMEs and middle-market firms with innovative technologies over the next five years (2024-2028). A total of 3.4 trillion won is to be funded in 2024 alone.   First of all, a 2.4 trillion won public-private corporate venture capital (CVC) fund will be formed in 2024 for investment in innovative startups, whereas large corporations will be supported in their business, marketing, and innovative infrastructure establishment to expedite open innovation.   Second, the industrial technology innovation fund in 2024 will pour 400 billion won into defense, AI-based autonomous manufacturing, carbon-free energy, and other advanced industries, while also strengthening support for regions and middle-market companies short of private venture investment. As for the unprecedented 36 billion won high-tech civil-military cooperative fund, defense companies attending the meeting vowed support for nurturing innovative defense firms via means of additional investment, company scouting, and commercialization assistance.   Third, MOTIE will create a 540 billion won low-interest R&D loan to assist companies’ technology commercialization and join hands with the SMEs and Startups Ministry (MSS) to initiate a special exemption guarantee that offers fees reduced by 0.5 percentage points to mitigate burden on companies. Furthermore, a 170 billion R&D fund will be supplied in 2024 in line with venture capital investment.   On the margins of the meeting, the 13 banks that will be executing the newly launched R&D loan participated in the ceremony for the industrial technology innovation fund memorandum of understanding (MOU). In addition to POSCO Capital, SGC Partners and Ascendo Ventures were also selected to jointly manage the CVC fund, and the three companies entered an MOU on this account.   Also attending the event was Ely Razin, Chief Strategic Investments Officer at Israeli investment platform OurCrowd, who expressed commitment to injecting over 40 billion won worth of foreign capital into Korea’s technology innovation fund. OurCrowd was selected as one of the technology innovation fund managers in 2023. date2024-04-05

Nuclear energy firms to benefit from KRW 100 bln loan fund in 2024

Trade, Industry and Energy Vice Minister Namho Choe chaired a conference with nuclear energy companies and memorandum of understanding (MOU) ceremony on executing special financial assistance for the domestic nuclear energy ecosystem on April 4 at Korea Atomic Industrial Forum (KAIF).   Part of a follow-up to the 14th Public Forum held this February, the event was hosted in the attendance of the representatives of six major banks participating in this year's KRW 100 billion nuclear ecosystem financial assistance project, as well as those from KAIF and Korea Energy Technology Evaluation and Planning (KETEP).   First, the Ministry of Trade, Industry and Energy (MOTIE) entered an MOU with banks and relevant institutions for the special financial assistance towards nuclear energy firms and agreed to cooperate on developing the program for tackling the industry’s financial challenges, information sharing, and the management and operation of business projects. Based on the consensus that fast liquidity is of utmost importance in lowering SMEs’ funding difficulties, each institution has been making swift headway in project notification, selection of project applicants, and loan appraisals. Over 34 billion won was executed in loans by the end of March, adding up to 50 billion won in April, with a total of 100 billion won to be funded within this year.   At the conference with the beneficiary companies, Vice Minister Choe listened to the nuclear energy industry representatives’ suggestions and opinions. Nuclear energy companies’ leaders spoke on how the increased work orders and financial assistance are vitalizing the industry atmosphere and suggested that the Government give continued interest and support towards SMEs and middle-market companies in the nuclear energy industry in terms of investment, R&D innovation, and export competitiveness.   Vice Minister Choe said that the Government will fully support the nuclear industry’s rebound as well as its future global performance and asked for industry players’ active participation in new investment, technological enhancement, and other means to qualitatively advance the industry. date2024-04-05