What do Donald Trump's tariffs mean for S. Korea?

The Trump administration's protectionist trade policy is taking shape with a fresh tariff on China and briefly postponed tariffs on Canada and Mexico amid renewed threats of blanket taxes on all imports to the U.S.

So what does this mean for export-oriented countries like South Korea?

Our Lee Soo-jin seeks to answer that question.

South Korea faces both risks and opportunities as global trade dynamics shift amid rising tariff tensions.

While U.S. President Donald Trump on Monday local time, decided to pause the implementation of the tariffs for Canada and Mexico, for at least 30 days, his 10-percent tariff on Chinese products took effect just after midnight Tuesday.

But these tariffs could potentially benefit Korean exporters, who'd gain a competitive edge in supplying products that China previously dominated.

According to one expert,.. U.S. companies may shift their supply chains to South Korean firms.

"In markets like the semiconductor industry, companies like SK hynix already have a strong presence, and if tariffs are imposed on China, South Korean products could gain an even greater competitive advantage."

As semiconductors are South Korea's top export item, this would boost the country's trade surplus.

But risks remain, as the expected drop in exports of Chinese goods to the U.S. may reduce Chinese orders for South Korea's key intermediate goods.

"Our country's export structure depends on selling intermediate goods to China, for them to be assembled into the final product for export to other countries. So, if demand for China's goods declines, demand for these intermediate goods will also decline."

And with growing concerns of possible tariffs on the EU and South Korea as well, South Korea's government and its companies are being proactive.

The South Korean government announced Wednesday that it will establish a "Strategic Advanced Industry Fund," worth over 34 trillion Korean won, or around 23 billion U.S. dollars, to boost industrial competitiveness.

"Ongoing global trade uncertainties, including additional tariffs on China, require close attention. We will establish the "Strategic Advanced Industry Fund" at the Industrial Bank of Korea to support high-tech sectors like batteries and biotech."

As for the private sector,.. SK Group chairman Chey Tae-won will lead a delegation to Washington, D.C. on the 19th to discuss response strategies, with a meeting with Trump reportedly under discussion.

Lee Soo-jin, Arirang News.