Trump says he will impose new tariffs on South Korea as he criticises delays in trade deal | South Korea
Donald Trump said that he increased customs duties on South Korean goods such as automobiles, lumber and medicine, accusing the country of not complying with the trade agreement reached last year and causing the stocks of Korean automobile manufacturers to lose value, albeit for a short time.
In a post on social media, the US president said tariffs on South Korean exports to the United States would rise from 15% to 25% because “the Korean Legislature has not enacted our Historic Trade Agreement, which is their prerogative.”
“The South Korean Legislative Assembly is not abiding by its agreement with the United States,” Trump said. The administration is yet to issue an official notification to put the changes into effect.
South Korea’s presidential office said it was not informed in advance about plans to increase tariffs. In the statement made on Tuesday, it was stated that commerce minister Kim Jung-kwan, who is currently in Canada, will go to Washington to meet with US Commerce Secretary Howard Lutnick on the issue.
Trump’s apparent reversal comes months after Washington and Seoul signed a trade and security agreement last year that ended a period of tense negotiations. The deal was finalized after Trump met with his South Korean counterpart Lee Jae Myung in October and included U.S. tariff cuts as well as South Korean investment promises.
But since then the agreement has remained in legal limbo in South Korea.
Seoul’s presidential office insisted in November that the agreement did not require parliamentary approval, arguing that it represented a memorandum of understanding rather than a binding legal document.
But on Tuesday the country’s ruling party said it would work with the opposition to speed up the passage of five pending bills that would allow investment in the United States to become law.
Under the agreement, Washington will impose tariffs of up to 15 percent on South Korean goods, including vehicles, car parts and medicines. Most importantly, the terms of the deal brought down U.S. tariffs on South Korean cars from the 25% level Trump imposed in early 2025.
Trump’s latest threat, if implemented, would reverse this situation.
The auto industry accounts for 27% of South Korea’s exports to the United States, and the United States accounts for nearly half of the country’s auto exports. Shares of many South Korean automakers fell as much as 5% in the minutes following Trump’s announcement, but regained their losses later in the day.
Trump used the threat of tariffs as a foreign policy tool throughout his second term. Economists have expressed concern about this approach, and the policy also faces the test in an ongoing case before the US supreme court. Tuesday’s threat targeting South Korea was its latest threat to major trading partners in recent days.
Over the weekend, Trump warned Canada that he would impose 100% tariffs on all goods coming across the border if it signs a trade deal with China. In early January, Trump also threatened to impose tariffs on several European countries until they bought Greenland. He has since backed off the threat.
Josh Lipsky, head of international economics at the Atlantic Council, said Trump’s action against South Korea reflects his impatience with the pace at which Seoul is enacting the framework trade agreement.
“This is a reminder that markets are wrong to believe we will achieve tariff stability in 2026,” Lipsky said. “People say, ‘Oh, but he doesn’t pursue it,’ and sometimes that’s true, but sometimes it’s not. And volatility alone comes at a cost.”
With Reuters and Agence France-Presse
