President Trump has announced intentions to raise tariffs on South Korean imports from 15% to 25%, accusing Seoul’s parliament of failing to ratify a trade agreement both countries reached last year. The threat specifically targets automobiles, lumber, and pharmaceutical products entering the American market.
The trade framework in question was finalized after intensive negotiations between Trump and South Korean President Lee Jae Myung in October 2024. The agreement featured reciprocal concessions including reduced US tariffs on Korean vehicles and commitments by Seoul to increase investments in American industries.
Korean officials expressed frustration at learning of the tariff threat through social media rather than diplomatic channels, with the presidential office stating it received no advance notification. Trade Minister Kim Jung-kwan is being redirected from Canada to Washington for emergency consultations with US Commerce Secretary Howard Lutnick.
The potential economic impact is significant, particularly for South Korea’s automotive sector which exports nearly half its production to the United States. The 27% share of total exports represented by automobiles makes the industry especially vulnerable to tariff changes, as demonstrated by the sharp stock price declines following Trump’s announcement.
Trump’s approach reflects a broader strategy of using tariff threats to pressure allies and adversaries on various policy objectives. While not all threatened tariffs are ultimately implemented, international economics experts note that the volatility created by unpredictable announcements carries real economic costs for businesses and markets.