Trump vows 100 percent chip tariff threat

U.S. President Donald Trump declared on Aug. 6 that he would impose a 100 percent tariff on all semiconductors, including integrated circuits, entering the United States. Although he did not specify the effective date, the announcement laid out a much steeper rate than the 15 percent on automobiles or 50 percent on steel and aluminum. The move placed semiconductors squarely at the center of the renewed trade war. According to analysts, the decision signals a new phase in tariff tensions, with potentially significant repercussions for South Korea’s tech industry. Semiconductors were South Korea’s second-largest export item to the United States last year. According to the Korea International Trade Association, the country exported $10.7 billion worth of semiconductors to the U.S. in 2024, accounting for 8.3 percent of its total exports to the country and 14 percent of its trade surplus.

During a meeting with Apple CEO Tim Cook at the White House, President Trump reiterated his intention to impose steep tariffs on semiconductors. However, he added that companies that are building factories in the United States or have made firm pledges to do so would be exempt. He also warned that companies failing to keep those promises would be penalized retroactively. He said the benefits they received from the waived tariffs would be recalculated and later billed.

Trump’s remarks are widely seen as an effort to pressure major semiconductor-producing nations, such as South Korea, Japan, and Taiwan, and their companies to boost investment in the United States. Apple also announced plans to invest $600 billion in the United States over the next four years.

Some observers say South Korea may avoid the worst-case scenario, as a recent trade arrangement with the United States ensures Most-Favored-Nation treatment for South Korean semiconductors. If Washington imposes the lowest proposed tariff rate of 15 percent on the European Union, South Korea could receive the same rate instead of facing the full 100 percent. Presidential spokesperson Kang Yoo-jung confirmed on Aug. 7 that South Korea received an MFN commitment from the United States.

However, concerns remain due to the lack of clear details. “Trump’s second term is positioning semiconductors as the primary target of itemized tariffs,” a diplomatic source in Washington said. “It is difficult to predict how the tariffs will be implemented, and it is too early to feel reassured.”


Jin-Woo Shin niceshin@donga.com