S. Korea, U.S. agree to continue ‘constructive’ discussions on IRA issue: ministry

December 12, 2022

WASHINGTON/SEOUL, Dec. 13 (Yonhap) — Senior South Korean and U.S. government officials had discussions on Seoul’s concerns about the impact of Washington’s Inflation Reduction Act (IRA) and agreed to continue “constructive” consultations to address the matter, according to a joint statement.

South Korea’s 2nd Vice Foreign Minister Lee Do-hoon met with Under Secretary of State for Economic Growth, Energy and the Environment Jose W. Fernandez in Washington, D.C., on Monday (local time) for the seventh Senior Economic Dialogue (SED) of the allies.

Lee used the session to explain again South Korea’s position on the IRA, which was signed into law by U.S. President Joe Biden in August. It calls for up to US$7,500 in tax credits to buyers of electric vehicles (EVs) assembled only in North America. Concerns have grown that South Korea’s leading carmakers — Hyundai Motor and Kia Corp. — could lose ground in the U.S. market, as they assemble their EVs at domestic plants for export there.

“Both sides also reaffirmed commitment to continue constructive discussions to address the ROK’s concerns and feedback regarding the Inflation Reduction Act (IRA),” the document read. The ROK is the acronym for South Korea’s official name, the Republic of Korea.

In a separate press release, Lee’s ministry said he requested that the Joe Biden administration take measures to address Seoul’s related concerns.

Fernandez said his government is taking the issue seriously and reviewing it from all angles, the ministry added.