South Korean companies plan more US investment pledges: report

[SEOUL] South Korea is set to unveil about US$150 billion in US investment plans by private companies during a summit between President Lee Jae Myung and US President Donald Trump, the Hankyoreh newspaper reported on Thursday (Aug 21).

The pledge is likely to include both ongoing and future projects and will be separate from the US$350 billion South Korea agreed to invest in the US as part of a trade agreement struck last month.

While the US$150 billion package will be highlighted at the summit, officials do not expect further discussion of the US$350 billion investment fund, which was a centrepiece of last month’s trade agreement, the newspaper said, citing unidentified government officials.

The trade agreement between the two countries reached in July capped US tariffs on imports of South Korean goods at 15 per cent, one of the most favourable rates.

Lee is set to meet Trump on Aug 25, a high-stakes trip that’s also expected to cover security issues.

The scale of US-bound investments to be announced on the occasion of the South Korea-US summit has not yet been determined, South Korea’s industry ministry said in a statement late Wednesday. The government did not offer an immediate comment when reached by Bloomberg News.

BT in your inbox

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign Up

Sign Up

Several Korean companies already have existing US investment plans, including Samsung Electronics’ multibillion-dollar semiconductor plant in Texas and Hyundai Motor Group’s US$21 billion pledge for vehicle and steel facilities.

Last year, Hanwha Ocean and Hanwha Systems acquired Philly Shipyard for US$100 million and parent Hanwha Group is preparing detailed investment plans tied to shipbuilding cooperation in the US, the report added.

Leaders of South Korean conglomerates, including Samsung’s Jay Y Lee, Hyundai Motor’s Euisun Chung, SK’s Chey Tae-won and LG’s Koo Kwang-mo, will join the delegation for the US trip, Yonhap News reported last week. Hanwha Group’s Kim Dong-kwan and HD Hyundai’s Chung Ki-sun and Hanjin Group’s Walter Cho may also join, according to Yonhap.

SEE ALSO

South Korea’s early exports show resilience despite US tariffs toll

South Korea to announce plan to restructure petrochemical sector facing ‘grave’ situation

South Korea to spend 210 trillion won to fund President Lee’s policy goals

South Korea think tank holds growth outlook despite trade deal with US

South Korea, Vietnam eye doubling trade to US$150 billion by 2030

More

South Korea has previously said that the country’s US$350 billion investment pledge as part of the US trade deal is largely structured as loan guarantees rather than direct capital injections and the actual equity commitment would remain below 5 per cent. BLOOMBERG