South Koreans got a fresh reminder of President Trump’s unpredictability when they woke up on Tuesday morning to see that he was increasing tariffs on South Korean exports, like cars, back to 25 percent.
Only recently it seemed that South Korea had resolved its worst trade dispute with the United States, its only treaty ally. After months of talks, Mr. Trump in October agreed to lower tariffs on South Korean products to 15 percent after winning a pledge that Seoul would invest $350 billion in the United States.
At the time, the South Korean leader, Lee Jae Myung, flattered Mr. Trump with gifts like a replica of an ancient golden crown. Mr. Trump extended the bonhomie with a surprising policy reversal, allowing South Korea to pursue a long-held goal of building nuclear-powered submarines.
Now the uncertainty that dogged relations between the two allies for months is back. Mr. Trump did not say when the new duties would go into effect, but he remarked that South Korea’s National Assembly was taking too long to implement the investment deal quickly enough.
“South Korea’s Legislature is not living up to its Deal with the United States,” Mr. Trump wrote on social media.
But South Korean officials on Tuesday insisted that the trade deal did not require parliamentary ratification because the two governments had signed a memorandum of understanding, not a treaty. They pointed out that competing bills sponsored by the governing party and the opposition have been filed since November. The goal is to create a fund for U.S. investments and a new corporation to manage it through bilateral consultation with Washington. But enactment has been delayed amid bickering between the political parties.
Mr. Trump has continued to wield tariffs as a cudgel, in recent weeks trying to use them against European nations in his bid to take control of the Danish territory of Greenland. He has backed off, for now, on those threats against Europe.
Seoul was caught off guard by Mr. Trump’s announcement on Tuesday. Mr. Lee’s office said that Washington had not officially informed it of Mr. Trump’s decision to increase tariffs or shared any related details. It added that South Korea’s trade and industry minister, Kim Jung-Kwan, who was visiting Canada, would travel to the United States soon to meet Commerce Secretary Howard Lutnick. Seoul also planned to send its chief trade negotiator, Yeo Han-koo, to meet his U.S. counterpart.
Top aides of Mr. Lee huddled on Tuesday to discuss how to deal with the latest bump in their country’s relations with the Trump administration. They checked on the prospects of bills pending at the National Assembly, said Kang Yu-jung, Mr. Lee’s spokeswoman. They also noted that the White House had not yet issued an executive order to put Mr. Trump’s new tariff threat into action.
“We plan to cope with this issue calmly while messaging to the U.S. side that we are determined to implement the deal,” Ms. Kang said. In the trade deal, South Korea had agreed to invest up to $20 billion a year, while setting aside another $150 billion to invest in American shipbuilding operations. But last week, its finance minister, Koo Yun Cheol, told Bloomberg News that the first planned $20 billion tranche was unlikely to be allocated in the first half of the year, given the time-consuming process to select projects. Such reports may have angered Mr. Trump, analysts said.
“This could weigh on the administration’s mind especially during an election year,” said J. James Kim, the director of the Korea Program at the Stimson Center in Washington.
Mr. Trump’s latest maneuver “introduces an element of uncertainty to the business environment for South Korean businesses that either export to the U.S. or have production facilities in the U.S. with supply chains that stretch into South Korea,” Mr. Kim said. “Everything from investment planning to logistics becomes more difficult.”
On Tuesday, Mr. Lee’s governing Democratic Party called for bipartisan cooperation to help implement the trade agreement.
“The key is how fast we can enact the special law and put in place supporting systems,” said Kim Hyun-jung, a party spokesman.
But the main opposition People Power Party blamed Mr. Lee’s government for the delay, accusing it of not sharing details of the trade deal with the opposition while advertising it as a key achievement for the Lee government.
The opposition and some analysts also feared that a sudden outflow of cash investments to the United States would further weaken the declining value of the South Korean won. The weak won has helped South Korean exports in recent months but hurt the prospects of economic growth by pushing down domestic consumption and investment.
“It clearly shows how unstable the foundation of the South Korea-U.S. tariff agreement is,” said Song Eon-seog, the floor leader of the opposition party.
Choe Sang-Hun is the lead reporter for The Times in Seoul, covering South and North Korea.
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