Leading South Korean and US companies announced billions of dollars in investments, joint ventures and other plans on Tuesday, as President Yoon Suk Yeol kicked off a state visit to Washington.
Yoon, who calls himself “the No 1 salesman” for South Korea, has made business deals and “sales diplomacy” a core element of his foreign trips.
General Motors Co and Samsung SDI said on Tuesday they will invest more than $3 billion to build a joint venture electric vehicle battery manufacturing plant in the United States, as the automaker diversifies its component suppliers.
South Korea’s Hyundai Motor Co also said it had finalised a $5 billion electric vehicle battery joint venture in the United States, boosting electrification efforts in its largest market.
After co-CEO Ted Sarandos met with Yoon, Netflix announced plans to invest $2.5 billion in South Korea over the next four years to produce Korean TV series, movies and unscripted shows, doubling the amount the company has invested in the market since 2016.
Dozens of business deals have been under discussion to be signed during Yoon’s visit, Choi Sang-mok, Senior Presidential Secretary for Economic Affairs, told reporters last week.
Yoon’s April 24-29 trip is the first state visit to the US by a South Korean leader in 12 years and will mark the 70th anniversary of a partnership that has helped anchor US strategy in Asia and provided a foundation for South Korea’s emergence as an economic powerhouse.
He is accompanied by more than 120 executives from South Korea’s biggest companies, including Samsung Electronics Executive Chairman Jay Y Lee and Hyundai Motor Group Executive Chair Euisun Chung.
Yoon is due to meet Biden for their summit on Wednesday.
Biden plans to commend huge South Korean tech investment in the United States, now approaching $100 million since he took office, a senior US official said last week.
Biden’s first stop on his inaugural trip to Asia as US president last year was a massive Samsung Electronics semiconductor plant in South Korea, underscoring a message of economic security with an eye on China and the war in Ukraine.
Advanced chips for functions such as 5G and artificial intelligence have become a focal point of competition with China and South Korea plays a vital role in the global supply chain.
Later when the US approved new rules about electric vehicle tax credits and subsidies for semiconductor businesses seen as having a negative impact on South Korean companies, however, it caused uproar in Seoul.
Yoon administration officials said this month that proposed electric vehicle tax rules from the US Treasury Department would “substantially” address many of South Korea’s concerns, but experts said there is unlikely to be any major progress in further resolving the disputes during the trip.
“With little expected on (the tax credits and chip subsidies), Yoon still needs economic achievement to present to South Koreans, and will likely emphasise the amount of investment he has attracted from US firms through this visit, like we saw from today’s Netflix announcement,” said Eom Kyeong-young, a political commentator based in Seoul.
Published in The Express Tribune, April 26th, 2023.
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