U.S. postpones pivotal trade talks scheduled with South Korea
The high-level trade meeting between South Korea and the US, originally scheduled for Washington on July 25, has been postponed due to a scheduling conflict with US Treasury Secretary Scott Bessent. However, both countries are continuing to engage in high-level talks to prevent the implementation of threatened 25 percent reciprocal tariffs on key sectors like steel and automobiles, set to take effect on August 1, 2025.
The postponement occurred while South Korea's Deputy Prime Minister and Finance Minister Koo Yoon-cheol was waiting at Incheon International Airport for his scheduled flight. Despite the delay, Koo and his counterparts, South Korea's Industry Minister Kim Jung-kwan and Trade Minister Yeo Han-koo, have continued consultations with their US counterparts in Washington.
U.S. Secretary of State Marco Rubio and National Security Adviser Wi Sung-lac had to cancel a face-to-face meeting due to an unexpected extension of Rubio's meeting with President Trump. Sufficient coordination has taken place via phone call between Wi and Rubio, and they have agreed to have an additional consultation, with the specific time and method to be arranged through working-level coordination.
The negotiations are continuing under pressure of an imminent tariff deadline, with both countries showing commitment to reaching a mutually beneficial agreement. South Korea is pushing for reduced tariff rates or exemptions through a comprehensive deal covering both tariffs and broader economic cooperation.
The "2+2" dialogue was to involve Koo, Trade Minister Yeo Han-koo from Korea, as well as Bessent and US Trade Representative Jamieson Greer from the US. Observers suggest that Japan's deal could serve as a benchmark for South Korea in its own negotiations, as both countries share similar trade dynamics with the US.
South Korea is considering an investment package exceeding $100 billion with participation from major conglomerates such as Samsung, SK, Hyundai Motor, and LG. This initiative aims to bolster manufacturing cooperation and further strengthen economic ties although specific details about this investment were not elaborated extensively in the immediate trade negotiation context but fit into the broader framework of bilateral economic engagement and strategic industry collaboration.
Without a meaningful advancement in negotiations, the baseline tariff is scheduled to increase to 25 percent on Aug. 1, intensifying economic strain on the export-dependent country. The postponement has sparked concerns in Seoul as the tariff deadline approaches, with insufficient time for a potential breakthrough.
President Lee Jae Myung was scheduled to meet with Samsung Electronics Chair Lee Jae-yong on Thursday, with discussions expected to focus on the US investment and tariffs. The US has proposed rescheduling the meeting between Bessent and Koo as soon as possible.
The trade negotiations between South Korea and the United States are described as "productive," with both sides actively seeking a deal to prevent the implementation of threatened 25 percent reciprocal tariffs on key sectors like steel and automobiles. Japan struck a deal with the US on Wednesday, agreeing to lower its tariff rate against Japan from 25 percent to 15 percent in exchange for a $550 billion investment in the US and a concession to open its market for more American automobiles and rice.
[1] The Korea Herald
[2] Bloomberg
- The postponement of the high-level meeting between South Korea and the US, originally scheduled for July 25, has raised concerns in Seoul about the impending tariff deadline, as time for a potential breakthrough seems insufficient. (The Korea Herald)
- South Korea is actively engaged in high-level talks with the US to prevent the implementation of threatened 25 percent reciprocal tariffs on key sectors, similar to the deal recently struck by Japan with the US. (Bloomberg)
- As South Korea pushes for reduced tariff rates or exemptions, personal-finance experts advise individuals to closely monitor the general-news for updates on the tariff negotiations, as the outcome could have significant impacts on the country's business sector and personal-finance. (The Korea Herald)
