The National Assembly of South Korea has approved a bill to establish a state-run investment corporation aimed at fulfilling a $350bn commitment to projects in the US, reported Bloomberg.
This move comes amid US President Donald Trump’s new tariff probe.
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Lawmakers passed the Special Law on Strategic Investment with the US in a plenary session, following unanimous committee endorsements earlier this week.
The legislation enables the creation of the Korea-US Strategic Investment Corp., which will oversee large-scale investments across sectors such as energy infrastructure, semiconductors and shipbuilding.
The new entity will start operations with Won2tn ($1.4bn) in government capital managed by a three-member board, according to South Korea’s finance ministry.
It will operate an investment fund to provide equity, loans and guarantees for US-based projects, including support for shipbuilding cooperation.
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By GlobalDataThe law also mandates the formation of a risk management committee to monitor financial exposures linked to these investments.
Passage of the investment bill comes as South Korea seeks to finalise last year’s trade agreement with Washington.
The delay in implementing its investment pledge had led Trump to threaten tariffs of up to 25% on Korean imports, resulting in Seoul accelerating the legislative process.
Following an earlier trade accord, the US retroactively reduced auto tariffs on South Korean vehicles from 25% to 15%.
Despite a US Supreme Court decision in February overturning Trump’s emergency powers to impose certain tariffs, South Korea has maintained its commitment to the trade deal.
On the same day as the bill’s passage, US Trade Representative Jamieson Greer announced an investigation under Section 301 of the Trade Act into more than a dozen economies, including South Korea.
This inquiry follows recent global tariff changes and may result in new duties on imports from countries deemed to have unfair trading practices.
Other economies subject to investigation include China, Japan, Mexico, India, Taiwan and those within the European Union.
The South Korean government said it would work closely with Washington to ensure existing trade benefits are preserved and that Korean exporters remain competitive against peers in other markets.
