South Korea has said it will uphold its trade agreement with the U.S. despite President Donald Trump’s announcement of higher tariffs on South Korean goods.
On Monday (26 January), President Trump accused Seoul’s legislature of failing to approve a previously agreed trade deal between the two countries.
For South Korea, the decision, which officials in Seoul said caught them by surprise, is the latest setback as it tries to navigate the alliance and trade partnership amid potential challenges to its security and financial stability posed by Trump's demands.
Presidential spokesperson Kang Yu-jung said Seoul would respond “calmly”, noting that any tariff increase would require administrative procedures before taking effect.
“The government will convey its commitment to implementing the deal to the US side,” Kang said.
The government has not yet received official notification from Washington and plans to reaffirm its commitment to the deal.
Trump and South Korean President Lee Jae Myung struck a deal in principle last July for Seoul to initiate investments in the U.S. worth $350 billion in return for a U.S. promise to cut tariffs on its exports.
"President Lee and I reached a great deal for both countries on 30 July 2025 and we reaffirmed these terms while I was in Korea on 29 October, 2025," Trump wrote on social media.
Trump said South Korea's legislature had not enacted the deal and as a result: "I am hereby increasing South Korean tariffs on autos, lumber, pharma, and all other reciprocal tariffs, from 15% to 25%."
The countries have been in talks to address Washington's concerns about regulations on U.S. tech firms as part of the trade deal.
Choi Seok-young, a former South Korean trade negotiator, said Trump's message could be seen as "a political move in which the United States is exerting maximum pressure on South Korea in an effort to force concessions during the ongoing negotiations over non-tariff barriers."
The White House and the U.S. Trade Representative's office did not immediately respond to requests for comment.
South Korea's presidential Blue House said the industry minister, Kim Jung-Kwan currently in Canada, would visit the U.S. soon and meet with Secretary of Commerce Howard Lutnick.
A spokesperson for South Korea's ruling Democratic Party had no immediate comment. The country's parliament is due to begin a new session on 3 February, when bills are usually taken up for votes.
South Korea's exports hit a record $709.4 billion in 2025, up 3.8% from 2024, while U.S.-bound shipments stood at $122.9 billion, down 3.8% but still making it the second-biggest market after China.
Auto exports to the U.S. stood at $30.2 billion, accounting for 25% of the total U.S. shipments, the biggest of any South Korean sector, but down 13.2% from 2024.
Higher tariffs would hit South Korean automaker Hyundai Motor and its affiliate Kia particularly hard, with their shares initially falling 4.8% and 6%, respectively, before recovering to trade 0.4% higher and 1.2% lower.
Under the deal struck last year, South Korea committed to invest $350 billion into U.S. strategic sectors. Of that, $200 billion would be paid in cash in phased installments that would be capped at $20 billion a year in an effort to maintain won stability.
The prospect of large currency outflows has caused headaches for authorities in Seoul at a time when the won has slumped to trade at levels unseen since the global financial crisis from 2007 to 2009.
South Korea's finance ministry said on Tuesday it would actively consult with parliament on the U.S. investment bill. Koo was already planning to ask parliament for cooperation on the matter on Tuesday afternoon, the ministry said.
Josh Lipsky, chair of international economics at the Washington-based Atlantic Council, said Trump's action reflected his impatience with the pace of Seoul's enactment of the framework trade agreement, while underscoring ongoing uncertainty about tariff rates.
"It's just another reminder that the markets were wrong to believe we were going to get into tariff stability in 2026," Lipsky said.
Ankara has condemned an Israeli plan to register large areas of the occupied West Bank as state property, a move widely criticised internationally and...
U.S. Secretary of State Marco Rubio said Washington is ready to pursue diplomacy with Iran as nuclear talks resume in Geneva, using a visit to Budapes...
Geneva is set to host two sets of negotiations on Tuesday, with U.S. officials meeting Iranian representatives in the morning and a trilateral session...
Kyrgyz President Sadyr Japarov has moved swiftly to consolidate his authority following the dismissal of his long-time ally Kamchybek Tashiev, head of...
Iran’s Revolutionary Guards navy held military exercises in the Strait of Hormuz on Monday (16 February), state-linked media reported. The drill too...
Iran’s Revolutionary Guards navy held military exercises in the Strait of Hormuz on Monday (16 February), state-linked media reported. The drill took place a day before renewed nuclear negotiations between Tehran and Washington in Geneva.
The 2026 Munich Security Conference (MSC) unfolded over three intense days in Munich, confronting a defining question of our era: has the post-Second World War international order collapsed - and if so, what will replace it?
Iran’s Foreign Minister Abbas Araghchi arrived in Geneva on Monday ahead of a second round of indirect nuclear talks with the United States, according to Iranian state media.
Azerbaijan and Serbia have formally launched a Strategic Partnership Council, marking a new phase in bilateral relations and placing cooperation under direct presidential oversight.
U.S. Ambassador to NATO Matthew Whitaker said China has the power to bring an end to Russia’s war in Ukraine, arguing that Beijing is enabling Moscow’s military campaign.
Austria’s Janine Flock won the gold medal in the women’s skeleton event at the Milano-Cortina 2026 Winter Olympics on Saturday.
Iran’s Supreme National Security Council Secretary Ali Larijani said the United States could evaluate its own interests separately from those of Israel in ongoing negotiations between Tehran and Washington.
U.S. Secretary of State Marco Rubio on Sunday (15 February) called it “troubling” a report by five European allies blaming Russia for killing late Kremlin critic Alexei Navalny using a toxin from poison dart frogs.
Ukrainian President Volodymyr Zelenskyy said on Saturday that Russia’s decision to change the leadership of its delegation for upcoming peace talks in Geneva appeared to be an attempt to delay progress.
U.S. Secretary of State Marco Rubio said Washington is ready to pursue diplomacy with Iran as nuclear talks resume in Geneva, using a visit to Budapest on Monday (16 January) to reaffirm both U.S. negotiating aims and strong ties with Hungary ahead of its April election.
Geneva is set to host two sets of negotiations on Tuesday, with U.S. officials meeting Iranian representatives in the morning and a trilateral session on Ukraine scheduled for the afternoon. The talks aim to advance a resolution of Iran’s nuclear programme and a U.S.-brokered peace plan for Ukraine.
Iran’s Revolutionary Guards navy held military exercises in the Strait of Hormuz on Monday (16 February), state-linked media reported. The drill took place a day before renewed nuclear negotiations between Tehran and Washington in Geneva.
A man accused of carrying out Australia’s deadliest mass shooting in nearly three decades appeared briefly in a Sydney court on Monday (16 February), facing terrorism and murder charges over the 14 December attack on a Jewish Hanukkah celebration at Bondi Beach that left 15 people dead.
The 2026 Munich Security Conference (MSC) unfolded over three intense days in Munich, confronting a defining question of our era: has the post-Second World War international order collapsed - and if so, what will replace it?
You can download the AnewZ application from Play Store and the App Store.
What is your opinion on this topic?
Leave the first comment