President Trump announced a trade deal with South Korea on Wednesday, putting 15 percent tariffs on South Korean goods, much higher than they were just a few months ago but lower than Mr. Trump had threatened.
Under the terms, South Korea will make $350 billion in investments in the United States and purchase $100 billion of liquefied natural gas. Mr. Trump said the South Korea’s president, Lee Jae Myung, would visit Washington in two weeks to make further announcements.
The agreement follows others that have been concluded in Asia. Although many details remain to be hammered out, the White House has announced that goods from Japan and the European Union will face 15 percent tariffs, the Philippines and Indonesia 19 percent, and Vietnam 20 percent. Among the Asian countries still without deals are India, Malaysia, Taiwan and Thailand. The Trump administration and China have agreed to a truce after inflicting sharp trade penalties on one another in the spring.
The South Korean government did not immediately issue a statement.
It’s been a long road for the South Koreans, who had to start over when a new government was elected in June. President Lee Jae Myung, five weeks into the job, received a reprieve when Mr. Trump extended his original July 9 deadline to Aug. 1.
However, the country’s negotiators had to compete for time with Trump administration officials who were attempting to conclude dozens of agreements at once on difficult issues such as market access for agricultural goods.
South Korea’s economy is extremely dependent on exports of goods and services, which accounted for 44 percent of its economic output in 2023. That’s twice the rate of its neighbor Japan, another export driven economy. South Korea ran a trade surplus of $66 billion with the United States in 2024, nearly four times what it was in 2018, when Mr. Trump revised the U.S.-Korea Free Trade Agreement.
The auto tariffs, set at 25 percent for nearly all imported vehicles, have eaten into the sales of major South Korean car brands. Profits at Hyundai dropped 16 percent in the second quarter from the previous year, as it has largely absorbed the cost of the duties so far.
The United States is still contemplating tariffs on pharmaceuticals and semiconductors, industries that have generated billions of dollars in sales for South Korea.
South Korean companies such as SK and Samsung have built semiconductor factories in the United States with the help of subsidies granted under former President Joseph R. Biden Jr. But the industry has argued that the supply doesn’t meet domestic demand and tariffs would undermine the U.S.’ competitiveness in artificial intelligence.
U.S. officials have been pushing South Korea to balance trade with the United States, open its market to U.S. exports and walk back proposed digital regulations that are seen as benefiting South Korean giants over American tech firms.
The announcement that the United States and Japan struck a trade deal July 22 put pressure on Korean negotiators to finalize their own arrangement.
Ana Swanson contributed reporting.
Lydia DePillis reports on the American economy. She has been a journalist since 2009, and can be reached at [email protected].
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