[KITA News] Making a revision to the IRA will be an extremely challenging task

              

Making a revision to the IRA will be an extremely challenging task

 

Making a revision to the IRA will be an extremely challenging task, KITA says

The U.S. and European automobile producing industries also did not detect signs of a move to introduce the IRA

Marn-ki Jeong, the Vice Chairman of KITA stressed the need of government-corporate collaboration

 

The Korea International Trade Association advised the necessity to take bold action to persuade the U.S. Congress to revise the Inflation Reduction Act (IRA). According to an announcement made by KITA on October 5, Marn-ki Jeong, the Vice Chairman of KITA, made such statement a day before during a seminar aimed at countering economic risks by taking advantage of mega-FTAs, which was co-organized by the World FTA Forum Jobs Center affiliated with the National Assembly and the office of Lawmaker Chang-hyeon Yoon from the People Power Party. Although requesting a revision to the IRA is widely deemed as a challenging task, KITA stressed the need to collaborate with global automobile makers and invest diplomatic effort to engage in an aggressive move to persuade the U.S. Congress to achieve the goal of requesting a revision to the IRA.

Vice Chairman Jeong mentioned, “Although the process for making a revision to the IRA after the middle elections is not completely impossible, it will be an arduous job to achieve this objective” and stressed, “Diplomatic effort and collaboration with global automobile makers should be activated to both persuade the Senate and the House of Representatives.” Meanwhile, John Bozzella, the President and CEO of Alliance for Automotive Innovation (AAI), Sigrid de Vries, the Secretary General of the European Automobile Manufacturers' Association (ACEA) and Governor Matt Blunt, the President of the American Automotive Policy Council (AAPC) all expressed a similar tone in their opinions in regards to the possibility of revising the IRA. They all said revising the IRA will not be an easy task and the chance of achieving meaningful change remains slim during the process of the U.S. Treasury designing specific guidelines.

Vice Chairman Jeong said, “Korean companies should take advantage of the subsidy scheme for EVs, which was newly introduced by the U.S.” and highlighted, “They should exert utmost efforts to secure benefits, including tax breaks offered for replacing fossil fuels and producing automobiles that incorporate the use of cutting-edge technologies, and cash subsidies provided for producing automobiles in the U.S.” He also advised, “The Korean government should devise ways for our companies to maintain competitiveness by offering measures, including those designed to reduce corporate tax for automakers that export their products to the U.S.”

Vice Chairman Jeong stressed, “It is our understanding that the U.S. and European automobile industries were not aware of a move by the U.S. Congress to make IRA into law in advance.” An official representing the American International Automobile Dealers Association (AIADA) mentioned, “We were taken aback as the move has been pushed forward without consulting the government and relevant industries.” An official representing the AAI also said, “There was practically no room for the U.S. automobile industry and the government to take necessary action in any way.”

An official representing the ACEA also mentioned, “As the European Commission is in the process of analyzing short-term impacts of the IRA, our organization will decide whether to bring the case to the World Trade Organization (WTO) depending on the research results by the European Commission.” The organization also added, “We will engage in an analysis on how the IRA will have a long-term effect on climate change and affect the supply of EVs.”

[This news is provided by Yonhap News]

By - KITA.Net (http://kita.org/about/newsView.do?id=&no=2741&searchWrd=&pageIndex=1)