In the early hours of January 27th, US President Donald Trump unexpectedly announced he would raise import tariffs to 25% on several key products from South Korea, including automobiles, timber, and pharmaceuticals. Trump cited Seoul's failure to fulfill its commitments under the previously reached bilateral trade agreement with Washington as the reason for this move, raising concerns about a potential resurgence of US-South Korea trade tensions amidst ongoing global economic uncertainty.
In a message posted on the social media platform Truth Social on January 26th, President Trump stated that the South Korean National Assembly has yet to ratify the trade agreement he described as historic, despite this being within South Korea's internal jurisdiction. According to him, this delay forces the US to adjust its tariff policy in a tougher direction. Specifically, import tariffs on automobiles, timber, pharmaceuticals, and other reciprocal tariffs on South Korean goods will be raised from 15% to 25%. However, Trump has not announced the official date for the implementation of the new tariffs, leaving the market and import/export businesses in a state of anticipation and caution.
Previously, in 2025, the US and South Korea reached a significant trade agreement aimed at easing tensions and boosting bilateral economic cooperation. Under this agreement, Washington agreed to reduce import tariffs on South Korean automobiles and auto parts from 25% to 15%, equivalent to the preferential rate the US grants to Japan. In return, Seoul committed to investing a total of $350 billion in strategic sectors in the US, including high technology, energy, and advanced manufacturing. Within that commitment package, South Korea planned to disburse approximately $200 billion in cash in stages, with a maximum of about $20 billion per year, partly to help maintain the long-term stability of the won.
