U.S. Threatens 100% Tariffs on Korean Memory Chips Amid Taiwan Benchmark
Updated (3 articles)
US Tariff Threats Target Korean Memory Chipmakers U.S. Commerce Secretary Howard Lutnick warned that memory chipmakers that do not invest in the United States could face tariffs as high as 100 percent, presenting firms with a binary choice to pay the duty or relocate production [1][2][3]. The warning was delivered at Micron’s Syracuse plant groundbreaking on Jan. 16 and explicitly referenced Samsung Electronics and SK hynix as potential targets [1][3]. Lutnick framed the policy as a tool to shift chip manufacturing home rather than a conventional trade measure [1].
Korea’s July Deal Delays Immediate Tariff Relief tariff pact reached in July reduced Korean import duties to 15 percent in exchange for a $350 billion investment commitment, but the relief was postponed after the November finalization of the agreement [1][2]. The deal treats Korean semiconductors similarly to those from larger exporters, with the Taiwan exemption cited as leverage in the negotiations [1]. Analysts note that the delayed relief leaves Korean exporters exposed to the looming 100 percent threat [1][2].
Taiwan Agreement Sets Benchmark for Korean Negotiations The recent U.S.–Taiwan semiconductor agreement grants tariff‑free quotas after Taiwan pledges $500 billion in investments, including $250 billion from TSMC, and sets a precedent for other exporters [2][3]. A clause in the U.S. fact sheet states Korea must not receive treatment less favorable than countries with larger chip trade volumes, effectively using Taiwan’s terms as a benchmark [3][1]. Seoul officials acknowledge the pressure and warn that matching Taiwan’s scale may be unavoidable to secure comparable concessions [3].
Korean Firms Already Invest Billions in US Production Samsung Electronics has announced about $37 billion of U.S. investment, primarily a foundry plant, while SK hynix has committed roughly $3.87 billion to a packaging operation, together totaling around $41 billion [1][2][3]. These existing commitments give Washington leverage to demand additional concessions as tariff negotiations continue [1][2]. Analysts caution that aggressive tariff moves could disrupt the Korea‑U.S. alliance and global supply chains that rely on Korean memory chips [1].
Seoul Emphasizes No‑Less‑Favorable Principle in Talks The South Korean presidential office reiterated the principle of ‘no‑less‑favorable’ treatment and pledged continued consultations to mitigate tariff impacts [2][3]. Officials also called for reforms to strengthen the domestic semiconductor ecosystem, including easing the 52‑hour workweek rule and boosting R&D support [2]. Seoul’s strategy aims to balance defense of its chip sector with the need to maintain access to the U.S. market [3].
Sources (3 articles)
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[1]
Yonhap: U.S. tariff pressure on Korea's memory chips grows after Taiwan deal: Details Lutnick’s 100 % tariff warning, ties to Taiwan exemption, outlines Samsung and SK hynix investments, and warns of alliance risks.
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[2]
Yonhap: US warns of up to 100% tariffs on non-investing chipmakers as Korea faces Taiwan‑like terms: Highlights similar tariff threat, Korea’s $350 billion investment pledge, “no less favorable” stance, and domestic reform focus.
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[3]
Yonhap: US semiconductor tariff plan tightens Korea pressure amid Taiwan deal: Describes tariff‑investment link at Micron ceremony, Taiwan benchmark, Korean investment totals, and Seoul’s consultation strategy.
Timeline
July 2025 – Korea and the United States reach a tariff pact that cuts Korean semiconductor import duties to 15 % in exchange for roughly $350 billion of Korean investment in the United States, laying the groundwork for later pressure on memory‑chip exporters. [1]
Nov 2025 – The July pact’s details are finalized, postponing the implementation of Korean tariff relief and linking the 15 % rate to the agreed‑upon $350 billion investment package. [1]
Jan 15, 2026 – The United States and Taiwan sign a semiconductor tariff agreement pledging $500 billion of total investment (including $250 billion by TSMC); in return, Taiwan receives tariff‑free semiconductor quotas that expand as U.S. production rises, creating a benchmark for other exporters. [3]
Jan 16, 2026 – At Micron’s Syracuse plant groundbreaking, Commerce Secretary Howard Lutnick tells global chip firms they face a stark choice: pay a 100 % tariff or relocate memory‑chip production to the United States, framing the policy as direct leverage. [3]
Jan 19, 2026 – Lutnick reiterates the 100 % tariff ultimatum at Micron’s plant, describing the tariffs as an industrial coercion tool and warning memory‑chip makers they must either pay the duty or build U.S. fabs. [1]
Jan 19, 2026 – The U.S. warns that memory‑chipmakers that do not invest in the United States could face tariffs up to 100 %, signaling that Samsung and SK hynix may be targeted unless they increase U.S. investment. [2]
Jan 19, 2026 – The Korean‑U.S. tariff agreement, finalized in November, postpones Korean import tariffs and sets a 15 % rate contingent on South Korea delivering $350 billion of investments (including $150 billion for shipbuilding and $200 billion for other strategic projects). [1][2]
Jan 19, 2026 – The Taiwan exemption model is cited as leverage: Taiwan secures zero tariffs on semiconductors after committing $250 billion in corporate investment, $250 billion in government‑backed credit guarantees, and a $100 billion TSMC investment. [1]
Jan 19, 2026 – Lutnick states the U.S. goal is to relocate at least 40 % of Taiwan’s chip supply and production to America, warning that tariffs could rise to 100 % if the relocation does not materialize. [1]
Jan 19, 2026 – Samsung Electronics has already invested about $37 billion in the United States and SK hynix roughly $3.87 billion, primarily in a foundry plant and a packaging operation, underscoring the scale of current U.S. footprints. [1][2]
Jan 19, 2026 – Analysts caution that aggressive, unilateral tariff moves could damage the Korea‑U.S. alliance and disrupt global supply chains, noting Korea’s weak won and the absence of a currency‑swap line as additional vulnerabilities. [1]
Jan 19, 2026 – Seoul reaffirms its “no less favorable terms” principle, pledging to consult with Washington to mitigate tariff impacts while defending Korean industry interests. [2]
Jan 19, 2026 – Korean policymakers call for reforms to strengthen the domestic semiconductor ecosystem, including easing the 52‑hour workweek rule and boosting R&D support, to reduce reliance on foreign design and equipment. [2]
Jan 19, 2026 – Semiconductors account for roughly 30 % of Korea’s exports to the United States, making chips the country’s second‑largest U.S. export category and a critical lever in the tariff negotiations. [3]
Future (2026‑2027) – The United States aims to shift at least 40 % of Taiwan’s chip supply to U.S. facilities, a target that will shape upcoming tariff negotiations with Korea. [1]