Kim Jung-kwan (second from right), minister of Trade, Industry and Energy, poses for a photo with signatories and US Commerce Secretary Howard Lutnick (third from right) at the signing ceremony for the Korea-US Shipbuilding Partnership Initiative MOU at the US Department of Commerce in Washington, D.C., on May 8 (local time). [Ministry of Trade, Industry and Energy]
Kim Jung-kwan (second from right), minister of Trade, Industry and Energy, poses for a photo with signatories and US Commerce Secretary Howard Lutnick (third from right) at the signing ceremony for the Korea-US Shipbuilding Partnership Initiative MOU at the US Department of Commerce in Washington, D.C., on May 8 (local time). [Ministry of Trade, Industry and Energy]

Kim Jung-kwan, minister of Trade, Industry and Energy, is set to visit the United States this week, with attention focused on whether the trip will include discussions on the Coupang Inc data breach dispute — the most contentious issue in the Korea-US relationship in recent months.

According to government officials Sunday, Kim will travel to Washington on Thursday to attend the opening ceremony of the Korea-US Shipbuilding Cooperation Center.

US Commerce Secretary Howard Lutnick is also expected to attend, with strengthening bilateral shipbuilding cooperation seen as the central agenda item.

However, observers broadly expect the visit to go beyond the official shipbuilding agenda.

Given that the Coupang Inc issue has emerged as a major flashpoint in the Korea-US relationship, analysts expect Kim to use the trip to clear up misunderstandings on the US side and head off potential trade friction before it escalates.

The Coupang Inc dispute is currently the most pressing issue in the bilateral relationship — so much so that South Korea's ambassador to the United States, Kang Kyung-wha, made an unusual return to Seoul to discuss a response. The controversy began after it emerged that the personal data of 37.56 million customers had been leaked from Coupang Inc in November last year.

The South Korean government and National Assembly have treated the matter as a serious breach, but the situation has grown increasingly complicated by the fact that Coupang Inc is a US-headquartered company.

Bilateral tensions surfaced in earnest this month. On July 1, the US House Legislation and Judiciary Committee, followed by the White House on July 2, released a report and statement in succession asserting that the South Korean government had treated Coupang Inc in a discriminatory manner.

The US side views Coupang Inc as an American company and has characterized the South Korean government's investigation into the data breach as an unfair and discriminatory measure targeting a US big-tech firm.

Seoul, for its part, has consistently maintained that its investigation into Coupang Inc is proceeding in accordance with the law and without discrimination. Yet eight months after the data breach, the two sides remain far apart in their assessments.

Experts point to the early handling of the case — rather than the incident itself — as a likely driver of US frustration.

Heo Jeong, a professor of economics at Sogang University, cited as a prime example the live broadcast of a National Assembly hearing in December last year, during which Harold Rogers, the interim head of Coupang Inc Korea, faced sustained questioning from lawmakers.

"From our perspective, we might argue it was nothing out of the ordinary — the same treatment given to the heads of major domestic conglomerates," Heo said. "But from the American perspective, there is a real possibility it was perceived as deeply humiliating."

Some analysts go further, warning that the US could use the Coupang Inc dispute as a pretext for future trade retaliation.

"With US reciprocal tariffs recently ruled unconstitutional, the US now needs to find non-tariff tools for protectionism — and it will almost certainly use the Coupang Inc issue to build its case," Heo said.

On the tariff cap of 15 percent agreed under last year's Korea-US tariff deal, Heo said the US could still inflict damage by imposing rates of 20 to 30 percent on sensitive sectors such as semiconductors, even while maintaining the average at 15 percent.

Trade authorities said they are actively managing the risk to prevent the Coupang Inc issue from spilling over into a trade dispute.

An official at the trade authority struck a cautious note, saying that if trade authorities took the lead publicly, it could backfire by making the matter look like a trade issue in the first place.

The official added that, given continued pressure from the US side, the Ministry of Foreign Affairs, the Ministry of Science and ICT and other relevant agencies are coordinating a response message and plan to convey South Korea's position clearly to the US through multiple channels.

Meanwhile, the official drew a line between the Coupang Inc dispute and suggestions that it was causing delays in South Korean investment projects in the United States.

"Investment in the US is a matter being discussed in specific and careful detail with the American side in accordance with domestic legal procedures and institutional constraints — it has no direct connection to the Coupang Inc issue," the official said.

The official added that the government intends to manage the related risks through various outreach opportunities, including Kim's upcoming visit to Washington.


oskymoon@heraldcorp.com