Seoul: President Lee Jae Myung announced that a new tariff agreement between South Korea and the United States will significantly reduce economic uncertainties for South Korea's export-driven economy. This statement followed U.S. President Donald Trump's announcement that his administration has agreed to implement 15 percent reciprocal tariffs on South Korea, which is 10 percentage points lower than previously proposed.
According to Yonhap News Agency, President Lee expressed relief on social media, emphasizing that the agreement marks a crucial step in stabilizing South Korea's export environment. The deal is expected to allow South Korean companies to compete on more favorable terms with major global players. Additionally, a substantial US$350 billion investment pledge from South Korea aims to reinforce bilateral cooperation in critical sectors such as shipbuilding, semiconductors, secondary batteries, biotechnology, and energy.
President Lee further detailed that $150 billion of the investment will be allocated specifically to facilitate the entry of South Korean shipbuilders into the U.S. market. This initiative is part of a broader strategy to enhance cooperation in strategic industries.
During the negotiations, both nations agreed to reduce tariffs on Korean automobiles-a significant export to the U.S.-from 25 percent to 15 percent, as reported by Kim Yong-beom, the presidential chief of staff for policy. However, contentious issues like rice and beef were addressed, with South Korea maintaining its current market policies in these areas due to concerns about food security.
The deal excludes sensitive items such as Seoul's ban on importing American beef from cattle aged 30 months or older, regulations on online platforms, and high-precision map data export restrictions. Notably, the agreement ensures South Korea will receive "most-favored nation" treatment in the semiconductor and pharmaceutical sectors if the U.S. imposes tariffs on these products.
Kim highlighted the $150 billion commitment to the shipbuilding sector as a pivotal move to deepen bilateral ties. The partnership is expected to leverage the design and construction expertise of Korean shipbuilders together with the software prowess of U.S. firms, fostering significant advancements in emerging fields like autonomous vessels.
The remaining $200 billion of the investment will target strategic sectors, including semiconductors, nuclear power, secondary batteries, and biotechnology, supporting South Korean companies' competitive entry into the U.S. market.