South Korea’s Industry Minister Kim Jung-kwan said Monday the country has avoided a worst-case trade scenario by reaching a tariff deal with the United States, though concerns remain over the impact on exporters’ profitability. Speaking at a roundtable with business groups and academics, Kim noted that the unprecedented 15% tariff on Korean goods could significantly affect competitiveness, particularly for small and mid-sized exporters, compared to U.S.-based rivals.
The agreement, reached with U.S. President Donald Trump, includes a $350 billion investment package. Of this, $200 billion will target strategic industries such as semiconductors, while the remaining $150 billion will support the U.S. shipbuilding sector. Kim said ongoing discussions with Washington aim to ensure the package benefits South Korea’s economy and industries.
Officials confirmed there is no written agreement yet, with further talks required to determine the investment fund’s structure and other specifics. The government emphasized the importance of shaping the deal to support long-term economic growth.
Despite the agreement, Kim stressed the need for a long-term strategy to navigate a “new normal” in global trade, where economic nationalism is gaining momentum. He underscored that the government will continue to work with businesses to safeguard competitiveness and adapt to shifting trade dynamics.
The tariff deal follows heightened trade tensions, with the U.S. seeking to impose higher duties on various imports. Analysts say that while the agreement prevents more severe restrictions, the 15% tariff could still strain margins, particularly in export-heavy sectors like automotive, machinery, and electronics.
South Korea plans to closely monitor the situation and pursue additional measures to protect exporters and maintain its standing in key global markets.