Korea passes tax break-driven 'Chips Act' as protectionism fears mount

South Korea has passed legislation giving tax breaks to its semiconductor companies in a bill being labelled as the "Korean Chips Act." At the same time, the nation's trade minister repeated its complaints that the criteria for Korean companies to access US funding are unpalatable in a possible sign of growing protectionism in …

[Snowy]

Panda in the room

I wonder how these unpalatable conditions compare with doing business in China? I bet there is no requirement for you to partner with a US company to do business in the USA, unlike China.

South Korea and Taiwan has for years offered tax break to it's technology sector the US is only playing catch-up to them in levelling the playing field a bit.

[Tron]

From globalisation to tribalisation in a trillion dollars of MMT.

Seoul is aiming for a second 'Miracle on the Han River' driven by the tech chaebols. SK is fairly protectionist as it is. Check out Naver. It helps to have your own language to geoblock tech. Japan does this too, but not as restrictively. Both SK and JP are in a tricky position. They were big winners of a globalised society, trading with the West and China. If the US bans them from trade with China and Chinese allies, they are going to feel the pinch big time, as isolated vassal states of Uncle Sam. Losing Chinese trade would be as bad for them as Brexit has been for the UK, relegating their economies.

Doing everything in your own backyard is hugely wasteful in terms of cash and resources, so the impact on the environment will be considerable. As governments are putting geopolitics before the environment, I guess climate change isn't that serious an issue after all. Global standards will go, so interoperability across borders will end and digital borders will match physical ones.

The UK is pretty much skint thanks to Brexit and doesn't have a lot to subsidise. We are now likely to be spectators in all this. Once the UKG roll out their own British standards, you're choice of tech will be drastically limited. You may be amazed at how fast things go down hill.

[VoiceOfTruth]

Re: From globalisation to tribalisation in a trillion dollars of MMT.

-> The UK is pretty much skint thanks to Brexit

We were skint before Brexit. Then don't forget the pandemic where much of the economy was shutdown for months. The effects of the shutdown are still being felt. Look in your high street and you will see more closed shops than a couple of years ago.

The problem the UK faces is that it is not competitive. Energy prices in the UK are higher than elsewhere in Europe and have been for several years. The only thing just about holding the UK up is financial services because for them energy costs are insignificant. Who care if the energy costs are high if you are dealing with £multi-billions?

You are right to mention the USA banning trade with China. This has come about thanks to PNAC. America does not care if the rest of the world goes down the crapper as long as it is the top dog. Alas we have poodles and stooges for governments rather than people acting in our best interests.