US Chip Tariffs: South Korea Sees Limited Immediate Impact

The United States has imposed a 25% tariff on certain advanced computing chips, a move that South Korea's trade minister said will have a limited initial impact on the country's semiconductor companies.

The new measures, announced by President Donald Trump, follow a nine-month national security investigation under the Trade Expansion Act of 1962.

Why South Korea Expects Limited Disruption

According to Trade Minister Yeo Han-koo, the first phase of the tariffs specifically targets high-end artificial intelligence chips from companies like Nvidia and AMD.

"Since the memory chips that South Korean companies mainly export are currently excluded, the immediate impact is expected to be limited," Yeo stated.

However, he cautioned that it was "not yet time to be reassured," highlighting uncertainty over how a potential second phase of tariffs could expand. Yeo confirmed the government will continue to work with the industry to protect the interests of South Korean firms.

What the New US Tariff Actually Targets

The 25% tariff applies to a narrow range of high-performance semiconductors and devices containing them. Among the products explicitly named are Nvidia's H200 AI processor and AMD's MI325X chip.

The White House specified that the tariffs would not apply to chips and related devices imported for:

• U.S. data centers

• Startups

• Non-data center consumer applications

• Non-data center civil industrial applications

• U.S. public sector applications

Broader Goals and Looming Tariff Threats

The action is part of a wider U.S. strategy to incentivize domestic semiconductor manufacturing and reduce reliance on chip producers in regions like Taiwan. According to a White House fact sheet, the United States may impose broader tariffs on semiconductors in the future to further this goal.

The potential for escalating measures was underscored by U.S. Commerce Secretary Howard Lutnick. Speaking at a groundbreaking ceremony for Micron's new plant in New York, Lutnick warned that South Korean and Taiwanese chipmakers not investing in the U.S. could face tariffs as high as 100% unless they commit to increasing production on American soil.