Seoul [South Korea], August 18 : South Korea's Industry Ministry has denied that semiconductors are being considered as the first project under Seoul's investment commitments in the United States, as Industry Minister Kim Jung-kwan holds talks in Washington over the investment package and related tariff issues, The Korea Herald reported.
"It is not true that semiconductors are being discussed as a candidate for the first strategic investment project in the US," the ministry said in a statement, according to the report.
The denial followed a local newspaper report that South Korea had initially considered an energy project but shifted its position after Washington strongly requested investment in US memory chip production facilities.
The ministry confirmed that Seoul and Washington remain in discussions over potential investment projects, but declined to disclose details.
"The government has continued communicating with the US side regarding strategic investment projects," the ministry said. "We cannot confirm the specifics of discussions between the two countries," according to The Korea Herald.
Kim departed for Washington on Sunday, around three weeks after a July 22-25 visit focused on investment and shipbuilding cooperation. Speaking to reporters after arriving in the US, Kim said Seoul had aimed to announce the first project in late August or early September.
However, additional working-level issues had emerged as negotiations entered their final stage.
"As we approach the end of the process, various specific issues are arising at the working level," he said, according to the report.
His return date remains undecided and could change depending on the progress of the talks, according to the ministry.
The two countries are seeking to accelerate implementation of investment commitments made under their tariff agreement. Kim is also expected to discuss the investment package alongside potential additional US tariffs under Section 301.
Concerns have increased that duties linked to forced labour and an ongoing investigation into industrial overcapacity could push tariffs on some South Korean products above the 15 per cent ceiling set under the bilateral agreement, the report said.
Under the agreement, Washington lowered tariffs on South Korean goods from 25 per cent to 15 per cent last year in exchange for USD 350 billion in South Korean investment commitments.
Of this, USD 150 billion was allocated to shipbuilding cooperation, while the two governments are still negotiating the deployment of the remaining USD 200 billion.
A gas-fired combined-cycle power plant in Texas has been mentioned as a potential first project, although key terms have not been finalised, according to the news report.