Donald Trump has officially announced a new trade agreement with South Korea. The agreement establishes 15% tariffs on products from the Asian country. Howard Lutnick, secretary of commerce, said “Today we agreed to another historic trade deal. The Republic of Korea will provide $350 Billion for the United States to invest as President Trump directs, with 90% of the profits going to the American people. South Korea also agreed to purchase $100 Billion in LNG and other energy products from the United States over the next 3.5 years.
“It is also agreed that South Korea will be completely open to trade with the US”
The deadline was August 1st. On the one hand, US trading partners had to give in to Trump’s demands to end the tariff deadlock by August 1st, or continue down the path they had begun and face astronomical tariffs. Donald Trump announced the deal on his Social Media account on Truth. “This sum will be announced within the next two weeks when the President of South Korea, Lee Jae Myung, comes to the White House for a Bilateral Meeting. I would also like to congratulate the new President on his Electoral Success. It is also agreed that South Korea will be completely OPEN TO TRADE with the United States, and that they will accept American product including Cars and Trucks, Agriculture, etc.” he said.
South Korea and the United States have signed significant agreements in recent years. South Korea is the seventh largest source of U.S. imports. Last year, it shipped $132 billion worth of goods to the United States, according to Commerce Department data. Vehicles, machinery, electrical equipment, mineral fuels, and plastics were among the top imported products. “When the President of South Korea visits the White House in the coming weeks, President Trump and President Lee Jae Myung will announce the enormous investments South Korean companies will make in America,” Howard Lutnick said.
United States exported $66 billion worth of goods to South Korea last year
Despite this agreement, the Trump administration’s tariffs have significantly impacted the South Korean economy. In fact, this year, gross domestic product contracted for the first time in four years. A 35% tariff, as planned, would have worsened the Asian country’s economic situation. It is important to mention that the United States exported $66 billion worth of goods to South Korea last year. Oil and gas, as well as industrial machinery, were the main exports.
Following this line, Lutnick is clear about the deal: “South Korea’s reciprocal and auto tariff rate will be set at 15%. They will also not be treated any worse than any other country on semiconductors and pharmaceuticals. Steel, aluminum, and copper are not included and remain unchanged.”
“… President Trump’s tariff and trade agenda has the power to reshape global commerce”
Let’s remember that Donald Trump had given a deadline to reach an agreement with the countries affected by the tariffs. To date, the US president has secured trade agreements with the European Union, the United Kingdom, Japan, Pakistan, and now South Korea, Vietnam, and the Philippines. “These trade deals reflect the clear understanding that President Trump’s tariff and trade agenda has the power to reshape global commerce. I could not be prouder to help deliver on President Trump’s promises to the American people. Trade and tariffs are how we Make America Great Again,” Howard Lutnick said on X.
What it is clear is that agreements between countries are going to keep coming. Especially when it comes to the United States, Donald Trump, and trade agreements. The tariffs the United States imposes on its international partners are a reality. Will the consequences of these tariffs be negative? That’s something only time will tell. For now, Trump continues to rewrite American history. In just six months, he has already played a role in so many historic events that we can only wait and see what comes next.
