Seoul: South Korea has successfully negotiated a trade deal with the United States, ensuring no further market opening to rice and beef. The recent agreement also guarantees that Korean chips and pharmaceuticals will not be subjected to higher tariffs than those faced by other countries, as confirmed by the South Korean presidential office.
According to Yonhap News Agency, the deal was finalized during last-minute negotiations ahead of a critical deadline. It includes a reduction in reciprocal and auto-specific tariffs from an initial rate of 25 percent to 15 percent. The agreement includes a significant $350 billion Korean investment pledge in the U.S., with $150 billion allocated specifically to the shipbuilding industry, alongside $100 billion designated for U.S. energy purchases.
Kim Yong-beom, the presidential chief of staff for policy, highlighted that the agreement ensures tariffs on semiconductors and pharmaceuticals are set at levels comparable to those enjoyed by other countries, with Korea receiving most-favored nation treatment. However, the arrangement does not extend to sectoral duties on major Korean export items such as steel and aluminum.
Rice and beef remained contentious issues during the negotiations. Despite pressure from the U.S. to open Korean agricultural and livestock markets further, South Korea resisted these demands, citing concerns over food security and the sensitivity of the agricultural sector. Farmers' groups had notably opposed lifting the ban on U.S. beef from cattle aged 30 months or older, a significant issue since protests erupted in 2008 during the mad cow disease scare.
The deal also excludes U.S. demands related to regulations on online platforms and restrictions on exporting high-precision map data. Kim indicated that a summit, which President Trump mentioned would occur "in the next two weeks" to announce further details, is being scheduled through diplomatic channels. South Korea's Foreign Minister Cho Hyun is expected to meet with U.S. Secretary of State Marco Rubio in Washington soon.
Kim described the $150 billion commitment to the shipbuilding industry as a vital step in strengthening bilateral ties. The initiative aims to cover the entire cycle of the shipbuilding sector, creating synergies in next-generation fields like autonomous vessels by merging Korean design and construction capabilities with U.S. software strengths.
The remaining $200 billion fund will be directed toward strategic sectors, including semiconductors, nuclear power, secondary batteries, and biotechnology, to support Korean companies' entry into the U.S. market. Kim assured that the $100 billion in U.S. energy imports is "manageable" and within the typical range required by the South Korean economy, potentially involving adjustments such as shifting imports from the Middle East to the U.S.
Regarding U.S. Commerce Secretary Howard Lutnick's statement that "90 percent of the profits will go to the American people," Kim interpreted this as a "reinvestment concept," ensuring the profits are reinvested within the U.S. rather than being immediately withdrawn. Kim expressed confidence in presenting a position that protects South Korean interests in managing this fund.