The crisis of trade tariff announcements by US President Donald Trump has caused concern among major global companies.
This situation has put great pressure on the economies of their respective countries that have been affected by Trump's tariffs.
Samsung Electronics, the world's second largest phone manufacturer, is no exception, which has experienced a major impact on continuing operations.
This is because its supply chain based in Vietnam has received a 46% tariff threat that has shaken the parent company's main base.
Professor Kim Dae Jong of Sejong University said that Samsung chose Vietnam as a supplier because the Southeast Asian country has labor costs one-tenth of those in South Korea.
According to KB Securities Managing Director Kim Dong Won, Samsung may suffer losses of up to US$2.7 billion if they fully absorb the cost of the tariffs.
However, this matter remains worrying even though Samsung is building up inventory and has the opportunity to negotiate between Hanoi and Washington.
At the same time, Professor of Economics Kang In-soo of Sookmyung Women's University explained that high tariffs may force companies like Samsung and LG to invest directly in the US.
In conclusion, Samsung's disclosure shows the weakness of economies in Asia that depend on exports from the US and encourages South Korea to face tariffs more systematically.
