President Donald Trump said on Wednesday the U.S. will charge a 15% tariff on imports from South Korea, down from a threatened 25%, as part of a deal that eases tensions with a top-10 trading partner and key Asian ally.
South Korea also agreed to invest $350 billion in the United States in projects selected by Trump and to purchase energy products worth $100 billion.
The arrangement, announced after Trump met with Korean officials at the White House, came during a blizzard of trade policy announcements. Many countries are rushing to cut deals ahead of August 1, when Trump has promised higher tariffs will kick in.
“I am pleased to announce that the United States of America has agreed to a Full and Complete Trade Deal with the Republic of Korea,” Trump wrote on Truth Social.
The negotiations were an early test for South Korean President Lee Jae Myung, who took office in June after a snap election. He said the deal eliminated uncertainty and set U.S. tariffs lower than or at the same level as major competitors.
“We have crossed a big hurdle,” Lee said in a Facebook post. Trump said Lee would visit the White House “within the next two weeks” for his first meeting with the U.S. president.
South Korea will accept American products, including autos and agricultural goods into its markets and impose no import duties on them, Trump added.
South Korea’s top officials said the country’s rice and beef markets would not be opened further, and discussions over U.S. demands on food regulations continue.
Seoul appeared to have defended its non-tariff barriers while keeping its tariff rate on par with Japan and the European Union, said Citi economist Kim Jin-wook.
“While the headline figure looks like a huge win for the U.S., details appear to be favorable for South Korea,” he said.
Credit:REUTERS