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With a head start of more than a decade, Georgia is now riding the crest of a Korean investment wave that is intensifying at a time of global uncertainty leading the U.S. and South Korea to shore up their longstanding alliance with deeper economic engagement.
The growing interdependence of trade and security drove the discussion at a half-day forum in Atlanta hosted by The Korea Society, the New York-based group organizing roadshows to restore grassroots bilateral connections as COVID-19 restrictions ease.
As supply-chain vulnerabilities bubbled up during the pandemic, discussion heated up around “friend-shoring” — the concept of sourcing those sensitive items that can’t be made at home from allies and partner nations.
The U.S. and Korea have gone even further, with mutual investment projects helping speed up once-in-a-generation industrial shifts in clean energy, electric vehicles and semiconductors, experts said at the event, hosted jointly with the Atlanta-based Southeast U.S.-Korea Chamber of Commerce.
An alliance that started with Korean dependency on U.S. protection in 1954 has now become a “global strategic partnership” that reverberates far beyond the Korean peninsula, said Thomas Byrne, president of The Korea Society. When the group was founded in 1957, international aid was financing nearly all of Korea’s fixed capital investment.
“Now more than six decades later, South Korean firms have invested a cumulative $62.4 billion in the U.S., almost twice the amount of us direct investment in Korea through 2020,” Mr. Byrne said. “In the past two years we’ve seen a surge in green investment in strategic industries helping to strengthen critical supply chains as well.”
Korea investment supports 94,500 jobs in the United States, with the South becoming a preferred destination largely in part to the automotive boom of the past 15 years.
Kia Motors set up shop in Georgia in 2009, following on the heels of Hyundai’s plant just down Interstate 85 in Montgomery, Ala. Both were followed by a raft of suppliers that made Korea one of Georgia’s top investment source countries.
The wave has swelled even higher in the past few years with the arrival of SK Battery’s $2.6 billion phase-one plant in Commerce, Hanwha QCELLS’s massive solar panel assembly factory in Dalton and the recent announcement that Hyundai would put a $5.54 billion dedicated EV plant near Savannah.
The latter project was revealed during President Joe Biden’s May trip to Korea, where he met with newly elected Korean counterpart Yoon Suk-yeol and footnoted the Hyundai deal as underscoring the nations’ partnership.
U.S. Sen. Jon Ossoff, the Democrat from Georgia, met with executives at the automaker in Seoul after Hyundai-Kia had announced a generalized plan for EV investment during former Korean President Moon Jae-in’s summit with Mr. Biden in May 2021 but hadn’t yet selected Georgia.
“There’s a reason that the first delegation I led as a U.S. senator was to the Republic of Korea last year,” Mr. Ossoff said in taped remarks played at the event. “The U.S.-Korea alliance is vital to U.S. national security and to our prosperity. And we know this well in the state of Georgia, where trade and commerce with the Republic of Korea is a significant and growing share of international trade.”
Korean Consul General Yoon-joo Park took this idea further, noting that 10 years after the U.S. and Korea ratified a free-trade agreement, Georgia is a microcosm for where bilateral ties are headed.
“Now it is time for us to prepare for a new decade by jointly responding to your global challenges with a foundation of the successful Korea-U.S. FTA,” he said. “If you are curious about how to brace for the next decade, you can get the answer right here in Georgia.”
Outside of Georgia the trend has held true as well, with reports revealing that Samsung could spend up to $200 billion on chipmaking across 11 plants in Texas in the coming decades.
An ‘Ironclad’ Alliance
These business ties and cultural connections help strengthen an alliance at a time of geopolitical upheaval caused by Russia’s invasion of Ukraine and North Korea’s continued provocations through nuclear tests.
“I don’t think there’s an inconsistency in talking about things being ironclad and yet, addressing efforts to strengthen it,” said retired Gen. Vincent Brooks, who commanded U.S. and United Nations forces in Korea. “I think the alliance has to continue to grow, adapt, and be strengthened in all of its areas, so when we talk about economic cooperation, technological cooperation, work in space — these are layers of iron being added to an ironclad relationship.”
Mr. Brooks shared the stage with Lee Kyung-koo, defense attaché for the Korean embassy in Washington, who recounted the sharing of meals and airlift capacity during the evacuation from Afghanistan that showed how the Korean armed forces expressed solidarity with those of NATO and the United States. The retired American commander added that relaxing exercises in an effort to open dialogue on North Korea’s nuclear ambitions during the Trump administration was counterproductive to U.S. readiness. The war in Ukraine, which was driven by one man’s “hubris,” shows that the conflict can occur even with a battlefield calculation might show it to be “illogical.”
It also showed that despots will try to exploit fissures in their adversaries’ alliances, as Russian President Vladmir Putin has tried to do unsuccessfully with NATO.
“Brittleness in alliances will be exploited. Countries like North Korea, Iran, China, Russia — these types of countries look for brittleness and apply pressure to the brittle points. If they can separate the U.S. and South Korea from one another, they will,” Mr. Brooks said.
The opposite, in fact, has come true in the case of Russia, which has seen NATO stand firm and consider expansion during Russia’s war in Ukraine. Korean President Yoon’s invitation to a recent NATO summit in Madrid is a signal that democracies are seeing the need to cooperate more closely to combat authoritarian regimes’ efforts to reshape the international order, Mr. Brooks said.
Korea also became a founding member of the Indo-Pacific Economic Framework, a Biden-administration initiative to re-center Asia in U.S. trade policy. In this context, the U.S. and Korea are working on issues as wide-ranging as fostering a free and open Internet, creating zero-emission vehicles, deploying measures to contain COVID-19, combating “digital authoritarianism” and, of course, denuclearize the Korean peninsula, Scott Walker, director of the office of Korean and Mongolian affairs at the U.S. State Department, said during a wide-ranging speech.
Georgia’s Advantages
With its strong Korean investment base, Georgia will figure into these conversations in a more meaningful way in the coming years, representatives from Kia, Delta Air Lines and SK Battery said during a business panel toward the end of the program.
Home to what some estimate to be the third largest concentration of Koreans and Korean-Americans in the nation, the state has pockets where Korean-language restaurants, stores, churches, schools and newspapers are dominant.
“If you go to Duluth or Suwanee, it feels like Korea. Sometimes it feels more Korea-ish than K-town in L.A. or 32nd in New York,” said Steven Jahng, head of external affairs and social value for SK Battery. “I think it is a key reason besides the infrastructure (that) the standard quality of living for an average Korean expat coming to Atlanta is by far much better than any quality of life you’re going to find in most regions of the United States.”
Delta Air Lines has played a role in fostering those ties through its nonstop flights to Seoul and its ongoing joint venture with Skyteam alliance partner Korean Air, said Athar Khan, Delta’s head of international specialty sales.
Yoonie Kim, a Korea-focused project manager at the Georgia Department of Economic Development who has worked with some of the state’s largest investments in history, said there are other practical reasons that Korean companies are flocking to Georgia: supply chain bottlenecks and shipping costs.
Thirteen years and 3.7 million Georgia-made cars later, Kia is building on the strong sense of partnership it has found in the state, overcoming new challenges by cultivating local talent and adopting the Korean spirit of “Pali Pali” — hurry-up growth, said Stuart Countess, president and CEO of Kia Georgia.
“We launched as a plant two brand new cars in the middle of the pandemic. That took a lot of coordination, but it also took a lot of perseverance and determination of individuals. You will not see us give up. There is no answer out there that says, ‘No.’ It’s just, ‘How are we going to get there?’”
Pat Wilson, commissioner of the Georgia Department of Economic Develompent, said the case of investors like Kia shows that the strengthening of the alliance and a favorable political climate, while beneficial, are not principally responsible for the ongoing wave of Korean investment.
“I think the driving factor is business need,” he said, noting that the state was working the Hyundai project before the Biden trip was announced, though it was one of the faster ones to go from conception to completion. “These companies are looking decades down the road.”
