Industry Minister Expects U.S. Overcapacity Probe Results This Month, Says 15% Cap Consensus Exists

Minister of Trade, Industry and Energy Kim Jeong-kwan stated that the results of the U.S. Section 301 investigation into overcapacity are expected to be announced by the end of this month, adding that a consensus has been formed between South Korean and U.S. trade authorities on a 15 percent ceiling.

Speaking at a Kwanhun Club debate held at the Press Center in Seoul today (the 6th), when asked about the expected timing of the U.S. Section 301 investigation announcement regarding overcapacity, Minister Kim replied, "As we understand it, we expect it to be announced within the end of August."

Previously, as the United States imposed a 12.5 percent tariff on South Korea related to forced labor, concerns have been growing that the final tariff rate could exceed the 15 percent agreed upon in last year's South Korea-U.S. trade agreement, depending on the outcome of the upcoming Section 301 investigation into overcapacity.

In response, Minister Kim emphasized, "We are doing our utmost to ensure that the Section 301 tariffs, including the remaining overcapacity-related issues, stay within the 15 percent we originally promised with the United States," adding, "There is a certain level of consensus on this matter between our trade authorities."

Minister Kim elaborated, "However, 15 percent is not the ultimate goal. Our goal is a level that does not put us at a disadvantage compared to competing countries. Because the United States set it at 15 percent by comparing us with competing nations, people think of it as 15 percent, but please understand that the goal for the South Korea-U.S. tariff level is a status that is not disadvantageous relative to our competitors."

Earlier in February, the U.S. Supreme Court ruled that the reciprocal tariffs imposed by the Donald Trump administration were unlawful.

Subsequently, the Trump administration temporarily imposed a global tariff of 10 percent worldwide under Section 122 of the Trade Act, but that measure also expired last month as its legal deadline arrived.

In response, the Office of the United States Trade Representative began applying Section 122 [Note: translated as written in source text] of the Trade Act starting on the 24th of last month to issue new so-called "forced labor tariffs" of 10 to 12.5 percent on major trading partners over the issue of imports produced with forced labor, with South Korea subject to a 12.5 percent tariff.

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.