Anchor: South Korean businesses are bracing for the potential impact of U.S. President Donald Trump’s 25 percent tariffs on imports from Canada and Mexico. Data shows that South Korea’s exports could decline in value by around 220 million U.S. dollars as a result.
Max Lee has more.

Report: While many South Korean manufacturers have avoided U.S. tariffs by looking to Canada and Mexico as export production bases, U.S. imports from those countries now face 25 percent tariffs, and conglomerates are scrambling for a solution.

The local corporate data firm Korea CXO Institute said Tuesday that 25 major conglomerates operate 201 local subsidiaries in Canada and Mexico.

Of these, 110 are located in Canada and 91 in Mexico.

They include 68 Samsung Group subsidiaries, 50 in Canada and 18 in Mexico; and 28 subsidiaries of Hyundai Motor Group, 12 in Canada and 16 in Mexico.

The institute expects South Korean automobile, car battery and home appliance companies with manufacturing plants in the two countries to lose price competitiveness in the U.S. market due to the tariffs.

Also, according to a report released last month from the Korea International Trade Association, the combined effects of the U.S. tariffs against China, Canada and Mexico could lower South Korea’s total exports this year by 220 million U.S. dollars compared with last year.

With the new tariffs in effect as of Tuesday, South Korean companies with production bases in the target countries may have to make major revisions to their investment and production strategies.

Strengthening local production in the U.S. is seen as the most likely strategy, as producing and selling final products such as electronics and automobiles there would significantly reduce tariff burdens.

Some companies are also exploring the possibility of shifting their export markets to avoid the tariffs by seeking to export goods produced in Mexico to Central and South America, Australia and Europe.
Max Lee, KBS World Radio News.