SEOUL — President Trump introduced on Wednesday that the U.S. had struck a commerce cope with South Korea, which can now face a 15% tariff on its exports.
Underneath the deal, South Korea will make investments $350 billion in key U.S. industries and buy $100 billion value of its liquified pure gasoline, Trump wrote on social media on Wednesday. He added that additional investments can be introduced when South Korean President Lee Jae Myung visits Washington within the subsequent two weeks.
The brand new price is a major discount from the 25% Trump had introduced through a letter earlier this month, however nonetheless a blow to the longstanding free commerce regime that had, for years, stored duties on items from both nation near zero. Trump has lengthy decried this association as unfair to the U.S., which final 12 months recorded a $66 billion commerce deficit with South Korea.
“We’re seeing that the negotiations taking place in lots of international locations since April are unfolding in a manner that may be very completely different from the rules of the WTO or FTA,” mentioned Kim Yong-beom, a senior coverage official for South Korea’s presidential workplace, at a press convention on Thursday. “It’s regrettable.”
Kim mentioned that South Korean negotiators had pushed for a 12.5% price on vehicles — one of many nation’s most vital exports to the U.S. — however that they’d been rebuffed, with Trump agency on his stance that “everyone will get 15%.”
U.S. and South Korean officers seem like deciphering the deal — whose particulars are nonetheless scant — in several methods.
New automobiles for export on a automotive service trailer arrive at a port in Pyeongtaek, South Korea, on April 15, 2025.
(Lee Jin-man / Related Press)
Calling it an “historic commerce deal,” commerce secretary Howard Lutnick wrote on social media that “90% of the income” of South Korea’s $350 billion funding would go “to the American individuals,” a declare that has instantly raised eyebrows in South Korea.
Trump mentioned one thing related in regards to the $550 billion funding package deal included within the commerce deal struck with Japan earlier this month. Japanese officers, however, have mentioned the income can be break up proportionately, primarily based on the quantity of contribution and threat from both sides.
On the press convention, Kim mentioned that Seoul is working underneath the belief that 90% of the income shall be “re-invested” — not unilaterally claimed. He added that the precise phrases nonetheless should be laid out on a “per-project foundation.”
“In a traditional civilized nation, who would have the ability to settle for that we make investments the cash whereas the U.S. takes 90% of the income?“ he requested.
South Korean President Lee Jae Myung has framed the $350 billion funding as a lift to South Korean shipbuilding, semiconductor and power corporations making an attempt to make inroads into the U.S. markets.
“This settlement is the assembly of the U.S.’ curiosity in reviving manufacturing and our intention to make South Korea corporations extra aggressive within the U.S. market,” he mentioned in a social media submit on Thursday. “I hope that it’s going to strengthen industrial cooperation between South Korea and the U.S. in addition to our army alliance.”
Whereas Trump additionally mentioned that “South Korea shall be fully OPEN TO TRADE with the USA, and that they’ll settle for American product together with Vehicles and Vans, Agriculture, and so forth,” Kim mentioned that agriculture was not a part of the deal and that no concessions on U.S. rice or beef — two main factors of competition between Seoul and Washington — got.
South Korea, which is the world’s high importer of American beef, at the moment bans beef from cattle which might be older than 30 months on issues it might introduce bovine spongiform encephalopathy, or mad cow illness.
Given its standing as a staple crop and a vital supply of farmers’ livelihoods, rice is without doubt one of the few agricultural items closely protected by the South Korean authorities. Seoul at the moment imposes a 5% tariff on U.S. rice as much as 132,304 tons, and 513% for any extra.
“We have been in a position to efficiently defend a number of our positions in these areas,” Kim mentioned.
