Row over electric vehicle subsidy rules overshadows South Korean president's first US visit

[anonymous]

Row over electric vehicle subsidy rules overshadows South Korean president's first US visit

South Korea's opposition to new rules governing US subsidies for electric vehicles are set to overshadow President Yoon Suk-yeol's first official trip to the United States, disrupting a recent display of alliance strength with Washington.

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Yoon, who was in London for the funeral of Britain's Queen Elizabeth, departed for New York late on Monday (Sep 19) to attend the UN General Assembly. He will fly to Canada on Thursday for the last leg of his trip before returning home on Saturday.

In New York, Yoon will hold a summit with US President Joe Biden where both leaders are expected to discuss North Korea's growing weapons threats, and mounting concerns in South Korea over the Inflation Reduction Act (IRA), signed by Biden last month.

The new law eliminates federal tax credits for electric vehicles (EVs) made outside North America, meaning companies including Hyundai Motor Co and its affiliate Kia Corp will no longer be eligible for such subsidies.

The law has sparked complaints from government officials in Seoul, who see it as a betrayal of Biden's vows to boost bilateral economic ties after South Korean companies agreed to make major investments and build factories in the United States.

Seoul officials have said the law may violate a bilateral free trade agreement, and they have asked Washington to postpone the new rules until Hyundai completes building its Georgia factory in 2025. Yoon is likely to reiterate that request during the upcoming summit.

[anonymous]

Yoon has also struggled to make progress on other crucial diplomatic and security issues ​slope unblocked, such as enhancing relations with Japan and luring North Korea back to denuclearization negotiations.

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