As the United States, regardless of whether it is a Democratic or Republican party, strengthens its protectionist response targeting China, there are concerns that Korean companies may also fall into the indirect sphere of influence.
On the 10th, the Korea International Trade Association (KITA)’s International Trade and Commerce Research Institute analyzed in a report titled ‘Contents and Impact of Strengthening US Protectionist Measures Ahead of the Presidential Election’ that the Biden-Harris administration is introducing policies to protect domestic strategic industries such as steel, aluminum, automobiles, batteries, and solar energy in addition to strengthening import restrictions.
Former President Donald Trump, who is running as the Republican candidate in the US presidential election to be held in November, also announced stronger measures than during his first term, including a 10% universal tariff and a 60% tariff on China.
Recent protectionist measures implemented by the U.S. government include ▲strengthening anti-dumping and countervailing duty regulations ▲increasing the number of new investigations ▲setting a wide range of investigation items ▲designating Chinese products as export destinations.
The number of new import restrictions that the U.S. initiated investigations for the past 12 months from the second half of last year to the first half of this year totaled 107. This is similar to the record-breaking year of 2020 (120 cases).
The U.S. Department of Commerce also revised related regulations in April to strengthen anti-dumping and countervailing duty enforcement. The revised regulations give the Department of Commerce more discretion, making it easier to determine dumping and subsidies, and provide a basis for imposing higher tariff rates on companies under investigation.
Also, Korean companies need to be careful as the target items of the investigation are set broadly, such as the aluminum extrusion case currently under investigation, and there are cases where our country is designated as a transit point for indirect exports to China.
The Biden-Harris administration is also introducing measures to protect key strategic industries one after another. The U.S. government has completed its review of the extension of Section 301 of the Trade Act, which had been delayed, and has raised Section 301 tariffs on key sectors such as electric vehicles, batteries, solar energy, and key minerals by up to 100%.
Also, the current administration has launched the Section 301 investigation targeting China’s shipbuilding and shipping industries for the first time. Section 301 of the U.S. trade law allows for retaliation in a wide range of areas when unfair trade practices by a trading partner restrict U.S. trade.
Also announced was the reimposition of tariffs under Section 232 of the Trade Expansion Act, which imposes tariffs on products not manufactured in North America to prevent Chinese steel and aluminum products from entering Mexico duty-free.
Extensive regulations on Chinese connected vehicles are also expected to be announced, including those manufactured in third countries using Chinese components and software. A number of import regulation investigations are also underway to prevent Chinese solar products from being exported to Southeast Asia.
Han Areum, a senior researcher at the Korea International Trade Association, emphasized, “Most of the U.S.’ protectionist trade measures are targeting China, but our companies should also be aware of unexpected impacts.” She added, “As the investigation into Chinese roundabout exports expands, there is a possibility that high tariffs will be imposed on Korean exports as well, so we need to continuously prepare strategies to respond to import regulation trends.”
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2024-09-11 01:51:32