South Korea to removes import tariffs on naphtha to support local petchem industry
South Korea is among the largest petrochemical-producing countries in Asia, but the nation depends heavily on the import market for naphtha to feed multiple world-class petrochemical complexes.
According to media reports, the South Korean Ministry of Economy and Finance on 6 July 2023 announced the abolishment of import tariffs on naphtha and crude oil used to produce naphtha in support of the local petrochemical industry amid the heightening global challenges and competition.
By the end of 2023, import duty on all naphtha grades from all origins will be lowered to 0% from the current 0.5%.
Besides, importers are entitled to 0% duty on the first 100 million barrels of imported crude oil used to produce naphtha at the same timeline.
South Korea is among the largest petrochemical-producing countries in Asia, but the nation depends heavily on the import market for naphtha to feed multiple world-class petrochemical complexes. The prolonged Russia – Ukraine war severely impacted the supply of Russian naphtha, which ultimately affect South Korean petchem producers’ ability to compete with Chinese and Indian suppliers in the international market.
CommoPlast reported in June that South Korean petchem producers have resumed taking in Russian naphtha after about a year of overlooking these cargoes following the Russia-Ukraine war complications.