Last Chance Before US Tariffs? July Exports Reach $60.8 Billion... "Semiconductors and Cars Unlikely to Be Greatly Affected by Tariffs" (Comprehensive)

[Financial News] In July, the month before the imposition of US tariffs, domestic exports recorded $60.8 billion, showing a favorable trend. From August, the imposition of item-specific tariffs by the US will begin in earnest, and the government expects that the tariff impact on Korea's major export items, semiconductors and automobiles, will not be significant. Semiconductors are expected to continue to have demand this year due to artificial intelligence (AI) servers, separate from tariffs, and automobiles, which will now be subject to the same tariff rate (15%) as European and Japanese companies, are also expected to be competitive in the US market.
 The Ministry of Trade, Industry and Energy announced on the 1st that domestic exports in July recorded the highest export amount among all Julys at $60.8 billion. This is an increase of 5.9% compared to the same month last year. This performance is attributed to the strength of major export items such as △semiconductors ($14.71 billion, 31.6% increase) △automobiles ($5.83 billion, 8.8% increase) △ships ($2.24 billion, 107.6% increase).
 The issue is the scheduled imposition of US tariffs in August. Korea is expected to face mutual tariffs of 15% and automobile tariffs of 15%, with announcements of tariffs on other items such as semiconductors also expected.
 In response, the government stated that the recent conclusion of tariff negotiations between Korea and the US has reduced uncertainty, and the immediate impact on major items such as semiconductors and automobiles is expected to be limited.
 Seogaram, Trade Policy Officer of the Ministry of Trade, Industry and Energy, stated regarding the semiconductor export outlook, "The impact is expected to be limited." He explained, "The major items exported to the US are high-value-added memory products that are difficult for US companies to produce, so the impact will be limited," adding, "However, finished product companies using semiconductors as components may be affected depending on the scope of tariff imposition."
 He further added, "At least until this year, the view that semiconductor demand is robust is dominant, and since AI server demand is maintained, semiconductors are expected to continue playing a leading role in our exports for the time being, even if tariffs are imposed."
 Automobiles will be subject to a 15% tariff this time. This is the same level as the EU and Japan, and considering that Korea previously had no tariffs while the EU and Japan had 2.5%, the tariff gap is narrowing. Some concerns have been raised that the competitiveness of Korean companies in the US market may weaken.
 Regarding this, Officer Seo stated, "It is regrettable that we previously exported under more favorable conditions than the EU and Japan, but the environment has completely changed this year," emphasizing, "If we had continued to apply 25% while the EU and Japan applied 15%, it would have been much more difficult."
 He added, "Since the conditions are now the same, a 2.5 percentage point difference is not absolutely disadvantageous considering the competitiveness of our automobiles," and "Our companies will be able to compete sufficiently."
 The government also revealed that some evidence of 'pushing out volumes' or advance purchases by the industry in July, ahead of the imposition of US tariffs, was detected. However, it is expected that such temporary movements will not have a significant impact on the annual export trend.
 Officer Seo stated, "In the case of semiconductors, even if there was some pushing out or advance purchasing, much more solid demand is supporting it, so exports are not expected to plummet."
jhyuk@fnnews.com Kim Junhyuk Reporter