South Korea's industry ministry said Wednesday it has clinched an agreement with Canada to expand economic ties and bolster cooperation in the supply chains of key minerals.
The Ministry of Trade, Industry and Energy signed the memorandum of understanding with Canada's economic development and natural resources departments on the sidelines of Canadian Prime Minister Justin Trudeau's visit to Seoul.
"Canada is rich in key minerals and holds a free trade agreement with the United States, making it an important partner (for South Korea) in addressing the U.S. Inflation Reduction Act (IRA)," the industry ministry said in a statement.
The IRA provides tax credits of up to $7,500 to purchasers of electric vehicles that are exclusively assembled in North America. In order to qualify for $3,750 of the amount, key minerals in the cars used must be sourced or processed within the U.S. or its free trade partners.
"This MOU will further advance intergovernmental cooperation in the field of key minerals. It will also help South Korean businesses diversify their capabilities to source them," the ministry added.
South Korea and Canada also agreed to cooperate in the sustainable energy sector, with the move anticipated to help more companies penetrate into the North American market, which already utilizes various sources, including hydroelectric power, to meet its energy needs.
Seoul will spare no effort to carry out follow-up steps of the MOU to flesh out details of the cooperation, the industry ministry added.
Source: Yonhap News Agency