South Korea to Monitor Impact of New U.S. Tariffs on AI Semiconductor Chips in 2026
- How Are U.S. Tariffs on AI Chips Affecting South Korea?
- What’s Behind the U.S. Push for Higher Semiconductor Tariffs?
- Why Is South Korea Focused on Currency Stability?
- How Does the $350 Billion Investment Deal Factor In?
- FAQ: Your Top Questions Answered
South Korea’s Industry Minister Kim Jung-kwan announced on January 15, 2026, that the government will closely monitor the newly imposed U.S. tariffs on advanced AI semiconductor chips to mitigate their impact on domestic manufacturers. The 25% tariff, targeting chips like Nvidia’s H200 and AMD’s MI325X, has raised concerns, though officials claim it won’t significantly affect Korean firms supplying data centers and U.S. startups. Meanwhile, Seoul is also tracking potential currency volatility amid a $350 billion investment pledge with Washington. Here’s a deep dive into the implications and reactions.
How Are U.S. Tariffs on AI Chips Affecting South Korea?
South Korea’s semiconductor industry is bracing for Ripple effects from the U.S.’s 25% tariff on select AI chips, announced via a national security decree. While Minister Kim Jung-kwan downplayed immediate disruptions—citing exemptions for data center and startup-related exports—industry reps warned of broader uncertainty. A White House fact sheet hinted at future tariff hikes to boost domestic production, a move that could destabilize global supply chains. "This isn’t just about tariffs; it’s about signaling protectionism," noted a BTCC market analyst. Historical context: The tariffs stem from a Section 232 investigation, which flagged semiconductor imports as a national security risk.
What’s Behind the U.S. Push for Higher Semiconductor Tariffs?
The Biden administration’s 2026 tariff policy leans heavily on a Commerce Department proposal to incentivize U.S.-based chip manufacturing. Companies investing stateside may receive tariff rebates, while others face rates potentially exceeding 100%. This mirrors Trump-era tactics—last summer, threats of 200–300% tariffs loomed unless firms built U.S. fabs. "The U.S. is playing hardball to reclaim tech sovereignty," observed TradingView’s latest sector report. Critics argue such measures could backfire, citing China’s retaliatory tariffs in 2024 that disrupted global tech trade.
Why Is South Korea Focused on Currency Stability?
Beyond chips, Seoul is scrutinizing Treasury Secretary Scott Bessent’s remarks on the won’s recent depreciation. During bilateral talks, Bessent called the currency’s slump "misaligned with economic fundamentals," sparking fears of deliberate devaluation. Finance Minister Koo Yun Cheol emphasized stable exchange rates as vital for the $350 billion investment deal—a cornerstone of U.S.-Korea economic ties. Fun fact: The won’s volatility index hit a 5-year high last quarter, per CoinMarketCap data.
How Does the $350 Billion Investment Deal Factor In?
October 2025’s landmark agreement saw South Korea pledge $200 billion annually to U.S. ventures in exchange for tariff relief. The deal, now in its implementation phase, ties currency stability to tech collaboration. "A shaky won could derail ROI for both sides," warned a Goldman Sachs memo. Meanwhile, Korean firms like SK Hynix are hedging bets by expanding U.S. production—a savvy MOVE given the tariff climate.
FAQ: Your Top Questions Answered
Which AI chips face the 25% U.S. tariff?
The tariff targets high-end AI semiconductors, including Nvidia’s H200 and AMD’s MI325X processors, as of January 2026.
Will South Korean chipmakers be exempt?
Partially. Chips for U.S. data centers and startups are excluded, but broader exports remain vulnerable to future hikes.
What’s the link between tariffs and the $350 billion deal?
The investment pact grants Korea tariff concessions, making currency stability critical to maintaining this quid pro quo.
