The global trade landscape faces new uncertainties today, as U.S. Commerce Secretary Luttig issued an ultimatum to South Korean memory chip manufacturers: a 100% tariff will be imposed on their products if they fail to invest in factories in the United States, stating bluntly that “local manufacturing or heavy tariffs are the only two paths.” This tough stance sent shockwaves through South Korea’s industrial sector. South Korea’s Trade Minister responded urgently, noting that the tariff only targets advanced computing chips, while memory chips—South Korea’s core export product—are not included for now, limiting short-term impacts.

Behind this tariff threat lies the Trump administration’s core strategy to attract manufacturing reshoring. U.S. Treasury Secretary Yellen previously stated that the government’s economic policies have attracted trillions of dollars in capital inflows, and the Treasury Department is strengthening policy certainty by improving tax technical rules. Markets are concerned that an escalation of trade frictions could reshape the global chip supply chain, forcing South Korean companies such as Samsung and SK Hynix to adjust their global production layouts and push up chip manufacturing costs.

Notably, South Korea’s labor market has shown signs of weakness. The employment rate for young people aged 20-29 fell 0.8 percentage points year-on-year to 60.2% in 2025, the first decline in five years. Combined with trade policy uncertainties, South Korea’s export-oriented economy will face dual pressures, and the Korean won may remain under pressure. The U.S. dollar against the Korean won rose 0.35% intraday to 158.07.