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President Donald Trump announced a new trade deal with South Korea, which calls for 15% tariffs on goods from there.
“The Deal is that South Korea will give to the United States $350 Billion Dollars for Investments owned and controlled by the United States, and selected by myself, as President,” he said in a Truth Social post on Wednesday.
Goods from South Korea briefly faced a 25% “reciprocal” tariff in April before Trump paused levies impacting dozens of nations. The pause was set to expire on Friday.
The new tariff of 15%, however, is still higher than the 10% minimum tariff South Korea and dozens of other nations’ goods have been charged since April.
Goods from the European Union and Japan, with which Trump announced recent trade agreements, also face a 15% tariff. Those agreements included relief from sectoral tariffs in place or threatened, including on autos and pharmaceuticals.
It’s unclear if South Korea was able to get such relief as well. Like Japan, it’s been pushing for lower auto tariffs, currently at 25%. Cars are a main source of exports for South Korea to the US.
South Korea is the United States’ seventh-greatest source of imports. Last year it shipped $132 billion worth of goods to the US, according to Commerce Department data. In addition to cars and car parts, semiconductors and electronics were among the top goods Americans bought from there.
Meanwhile, the US exported $66 billion worth of goods to South Korea last year. Oil and gas, as well as industrial machinery, were the top two exports.
The United States and South Korea have had numerous free trade agreements over the past two decades, which have been renegotiated on several occasions, including during the first Trump administration.
Trump’s tariffs have been taking a toll on South Korea’s economy, with gross domestic product for the first quarter of this year unexpectedly contracting by an annual rate of 0.1%, the first negative reading in four years.
This is a developing story and will be updated.
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