As the political landscape in key investment regions shifts following the U.S. midterm elections, new uncertainties are emerging for South Korean companies investing in the United States. Kim Jeong-kwan, the Minister of Trade, Industry and Energy, expressed that the government is preparing responses to these changes.
During a meeting of the National Assembly's Trade, Industry, Energy, Small and Medium Enterprises Committee on November 9, Kim stated, "We are analyzing the results of the gubernatorial and congressional elections and preparing responses focused on regions where South Korean companies have a significant presence."
Democratic Party lawmaker Lee An-joo pointed out that the election results could impact subsidies and tax benefits for South Korean companies, particularly in Texas, where many South Korean firms have established a strong foothold. "In Texas, our companies have significantly expanded in recent years, effectively forming a corporate cluster. We must ensure that our companies do not face disadvantages amid rapidly changing local policies," Lee emphasized.
In the midterm elections, the Democratic Party secured a majority in both chambers of Congress. Notably, in Texas, traditionally a Republican stronghold, Democratic candidate Gina Hinojosa defeated incumbent Republican Governor Greg Abbott.
Hinojosa has indicated plans to halt new development approvals until protective measures regarding the power and water usage of data centers are established, raising concerns about potential delays in investments related to AI infrastructure centered around data centers.
The Texas Ensign Natural Gas Combined Cycle Power Plant, selected as the first project under a $350 billion strategic investment agreement between the South Korean government and the U.S., is also under scrutiny. This project, with a total cost of $22.3 billion, aims to supply power to nearby AI data centers, with the first phase expected to begin commercial operations in 2029 and full operation targeted for 2032. Stricter regulations on data center development could impact demand forecasts and investment timelines for related power projects.
Minister Kim acknowledged these concerns and stressed the need for enhanced government responses and strengthened diplomatic efforts from the National Assembly. He noted, "The government alone has various limitations, and active parliamentary diplomacy on trade issues would greatly benefit our companies."
Democratic Party lawmaker Jang Cheol-min also suggested expanding parliamentary diplomatic activities within the Trade, Industry, Energy, Small and Medium Enterprises Committee to respond to changes in the global trade environment. Minister Kim agreed with this proposal, stating, "We will work together to make efforts on this front."
* This article has been translated by AI.
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