South Korean Tech Braces as US Tariff Storm Brews Over Semiconductors
Feeling the heat from Washington? So are South Korea’s electronic component makers. As the US moves closer to slapping fresh tariffs on a wide swath of tech products, companies like Samsung, SK hynix, and LG are eyeing the developments nervously. The Korean Herald reports that while semiconductor manufacturers investing in US plants might dodge the worst, component makers and finished product exporters aren’t as lucky. “The US may grant semiconductor tariff exemptions, but those are likely to apply only to products exported directly to the US,” said Han Ah-reum of the Korea International Trade Association. That means smartphones, PCs, and other gadgets—despite containing exempted chips—could still get hit. With the US Commerce Department preparing to unveil a list of derivative products, uncertainty is at an all-time high. And for Korea’s tech ecosystem, the risk isn’t just financial—it’s structural.
Semiconductor Tariffs: Exemptions With Strings Attached
President Trump’s proposed “100 per cent tariff on semiconductors” may sound like political theater, but it’s already rattling boardrooms across Seoul. The biggest worry? Exemptions may apply only to raw chips exported directly, not to the gadgets they power. Samsung Electronics and SK hynix might avoid the blow thanks to their American fabs, but LG’s smartphones and Samsung’s tablets may not get the same pass. Commerce Secretary Howard Lutnick hinted that tariffs could extend to consumer tech in a bid to “boost local production.” The ripple effect? Tariff costs may land squarely on device prices, putting tech giants in a bind.
Finished Products Could Feel the Real Tariff Burn
Samsung Display CEO Yi Chung warned, “If tariffs from the US raise the prices of finished products, that could lead to downward pressure on display and other component prices.” Tech suppliers are scrambling to review supply chains, fearing a drop in US consumer demand. With weak retail sentiment already biting into electronics sales, higher price tags could trigger a full-blown slowdown. One official, speaking anonymously, said, “If smartphones and PCs are categorized as semiconductor derivative products, maintaining the current retail prices will be difficult.” For South Korea’s vast supplier base, even a small tariff tweak can cause massive downstream effects.
Global Tariffs Create A Complicated Tech Chessboard
While Korea watches the US, trade tensions are bubbling elsewhere too. The EU continues to impose retaliatory tariffs on Chinese EVs and solar panels. India has raised import duties on a range of Chinese electronics. Meanwhile, China has responded with rare-earth restrictions, targeting chip manufacturing materials. The Biden administration recently tightened rules around advanced chip exports to China, while Canada and the UK mull over critical mineral export curbs. All eyes are on WTO negotiations, but global consensus remains elusive. For companies operating across borders, this means more red tape, more paperwork, and a lot less predictability in supply chain planning.
Supply Chain Realignment Already Underway
Tech suppliers aren’t waiting. Apple’s recent US manufacturing expansion signals a shift toward regionalized production. Korean suppliers are rethinking strategies, wary of disruptions. The report noted past tariff complications, including delays at Samsung Electro-Mechanics’ Mexican plant and steep import duties in Vietnam, later eased through negotiation. Now, manufacturers prepare for another round. “Apple has recently unveiled large-scale investment plans in the US in a bid to ramp up domestic production,” one official said, citing a global supply chain reshuffle. If exemptions stay limited and tariffs hit downstream products, companies may need to pivot fast to keep margins intact.
Traders, Feeling the Tariff Heat? Here’s Your Survival Game Plan
So, tariffs are flying again—and your portfolio’s feeling twitchy? Time to channel your inner ninja. First, don’t blink: keep a close watch on updates from the U.S. Department of Commerce and global trade chatter. Got South Korean tech stocks? Maybe rethink those—especially if they’re married to U.S. exports. Hedge like a pro to ride out chip-sector whiplash, and don’t forget to sprinkle in some companies with solid local markets or U.S.-based factories. Oh, and keep an eye on the won-dollar tango—tariffs love shaking up currencies. Bottom line: don’t guess. Read, react, and trade with precision.
(With Inputs From ANI)
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Aishwarya is a journalism graduate with over three years of experience thriving in the buzzing corporate media world. She’s got a knack for decoding business news, tracking the twists and turns of the stock market, covering the masala of the entertainment world, and sometimes her stories come with just the right sprinkle of political commentary. She has worked with several organizations, interned at ZEE and gained professional skills at TV9 and News24, And now is learning and writing at NewsX, she’s no stranger to the newsroom hustle. Her storytelling style is fast-paced, creative, and perfectly tailored to connect with both the platform and its audience. Moto: Approaching every story from the reader’s point of view, backing up her insights with solid facts.
Always bold with her opinions, she also never misses the chance to weave in expert voices, keeping things balanced and insightful. In short, Aishwarya brings a fresh, sharp, and fact-driven voice to every story she touches.
