South Korea's trade chief has cautioned that the threat of higher tariffs from the United States remains a concern, urging careful management of trade-related issues to prevent wider friction between the two nations. Trade Minister Yeo Han-koo stressed the need for vigilance, particularly regarding matters related to Coupang Inc., to ensure they do not escalate into broader disputes.
Yeo Han-koo said that Seoul has communicated its readiness to swiftly implement commitments agreed upon with the U.S. last year, including accelerating parliamentary work on the Special Law on Strategic Investment with the U.S. He noted that U.S. concerns have primarily focused on perceived delays in the National Assembly's deliberations regarding the legislation, which has raised doubts about South Korea's dedication to implementing the deal. Seoul has responded by communicating its efforts to expedite the process through bipartisan cooperation.
The risk of increased tariffs has emerged as the U.S. seeks to resolve trade tensions with other countries, including India. Trade is a vital component of South Korea's economy, with exports accounting for approximately 40% of its gross domestic product, and the U.S. is the country's second-largest market.
According to Yonhap News Agency, President Trump previously announced on January 26 that he would raise tariffs on Korean-made automobiles and reciprocal tariffs from 15% to 25%, citing the National Assembly’s progress on legislation for a special bill on U.S. investment.
Yeo also downplayed the potential significance of a notice in the U.S. Federal Register, describing it as part of Washington's internal administrative procedures. He stated that the key consideration for South Korea would be whether any tariff increase takes effect immediately or after a grace period.
"As we still have time for talks, we'll continue to engage closely with the US and make every effort to ensure the outcome is as favourable as possible to our national interest,” Yeo told reporters. He also stated that Seoul is holding talks with Washington on the basis that posting the official notice on the Federal Register itself is not necessary.
In late July 2025, the U.S. and South Korea reached an agreement that stipulated a 15% tariff on all South Korean imports, alongside South Korea's commitment to invest $350 billion in the United States. While South Korean officials engaged with their U.S. counterparts to address "unnecessary misunderstandings" regarding the delay, Trump continues to criticize trade partners, using tariffs as a tool in economic and political disputes.
The United States–Korea Free Trade Agreement (KORUS FTA), a trade agreement between the United States and South Korea, was signed on June 30, 2007. The treaty eliminates 95% of each nation's tariffs on goods within five years and creates new protections for multinational financial services and other firms.