South Korean Lawmaker Demands Scrutiny of US Investment Deal, Cites Financial Risks

A prominent South Korean opposition lawmaker on Monday called for formal parliamentary scrutiny of a major investment package planned for the United States, citing concerns that the deal could expose Seoul to disproportionate financial risks.

Kim Sung-won, chairman of the National Assembly’s trade committee, warned that ongoing negotiations over key energy projects could result in an unfavorable balance of profit and loss for South Korea.

Scrutiny Demanded Over Investment Risks

After meeting with South Korea's top trade envoy, Park Jung-sung, Kim expressed apprehension about the terms of the deal. He highlighted several potential issues in a Facebook post, stating, "Things become more worrying the closer one looks."

Key concerns raised by the lawmaker, who is a member of the opposition People Power Party, include:

• Potential barriers preventing South Korean-designed nuclear reactors from entering the U.S. market.
• "Deteriorating" conditions for a planned gas-fired power plant project in Texas.
• A risk that the United States could receive most of the profits while South Korea bears potential losses.

Context of the $350 Billion Deal

Ad

The planned investments are part of a broader $350 billion commitment South Korea made to the U.S. under a trade agreement that lowered U.S. tariffs on South Korean goods to 15%. According to Reuters, implementation of that trade deal has been delayed.

Negotiations have reportedly centered on significant energy infrastructure, including the Texas power project and the construction of up to eight nuclear reactors. Media reports have indicated that talks have been complicated by disagreements over reactor technology, financing structures, and the allocation of profits and losses.

Government Response

Kim criticized the government's intention to provide a briefing to lawmakers rather than seek formal parliamentary consent for the investment. In response, the Industry Ministry stated that it will proceed with the strategic investments in accordance with South Korean law.

A parliamentary briefing on the matter, which was postponed last week, is now expected to occur on Tuesday, an official familiar with the issue told Reuters. South Korean President Lee Jae Myung acknowledged on Monday that some elements of the negotiations would not be "easy to accept," but expressed confidence that "wise solutions" could be found by prioritizing national interests.