Trump strikes tariff deal with S. Korea as deadline nears

US President Donald Trump said Wednesday that Washington will slap a 15% tariff on goods coming into the country from South Korea, a lower rate than the 25% duty he had threatened earlier.  

The new levy puts South Korea on par with other US trade partners like Japan and the European Union, which have also secured trade deals with Trump that set a 15% tariff rate for their exports to the US. The new rate would also apply to South Korean automotive exports.

Trump touted it as a "full and complete trade deal" between the US and South Korea.

He said Seoul had also agreed to buy $100 billion (€87.5 billion) worth of US energy products, including liquefied natural gas (LNG).

"South Korea will give to the United States $350 Billion Dollars for Investments," Trump said in a post on his Truth Social platform. He added that an additional unspecified "large sum of money" will be invested in the US by Seoul.

Will South Korea open its rice, beef markets?

It was not immediately clear how the investment deals would be structured, where the financing would come from, or over what time frame.

Trump said additional South Korean investments would be announced later.

He added that the East Asian nation would further open up its markets to American products, including cars, trucks and agricultural goods, and impose no import duties on them.

Kim Yong-beom, policy chief from the South Korean presidential office, told a briefing in Seoul that the country's rice and beef markets would not be further opened to the US due to the sensitivity of the sectors.

Trump said Wednesday that South Korean President Lee Jae Myung would visit the White House "within the next two weeks" for bilateral talks.

The meeting will be their first since Lee assumed office in June.

'We have cleared a major hurdle,' South Korean President Lee Jae Myung said after Seoul reached a trade deal with WashingtonImage: ANTHONY WALLACE/Pool via REUTERS

What's the reaction in South Korea?

Following Trump's tariff announcement, Lee said the agreement would put South Korea on an equal or better footing compared with other trading partners.

"We have cleared a major hurdle," Lee said, according to news agency Yonhap. "Through this deal, the government has eliminated uncertainty surrounding export conditions and ensured that US tariffs on our exports are either lower than or equal to those imposed on our major trade competitors."

South Korea's opposition People Power Party (PPP), however, criticized the agreement.

It said Lee's administration had rushed to clinch a tariff deal with Washington and that a lot of concessions were made.

Song Eon-seok, interim leader of the PPP, called for the government to clarify if any other trade areas will be open to the US.

Brazil hit with tariffs, but key sectors excluded

Meanwhile, Trump on Wednesday also imposed a 50% tariff on most imports from Brazil, citing a "witch hunt" against his ideological ally and former President Jair Bolsonaro.

The blow was, however, softened by Trump exempting some items such as aircraft and parts, aluminum, tin, wood pulp, energy products and fertilizers from the heavier duties.

"We're not facing the worst-case scenario," Brazilian Treasury Secretary Rogerio Ceron told reporters. "It's a more benign outcome than it could have been."

Brazil said it remains willing to negotiate with the US on trade, but that it will not give up on tools to defend itself under national law.

In a statement signed by President Luiz Inacio Lula da Silva, the Brazilian government called the use of "political arguments" to defend the tariffs announced by the US against Brazil "unjustifiable."

Brazil is one of the few major economies with which the US runs a trade surplus.

Last year, the US' surplus amounted to $6.8 billion on a total trade volume of $91.5 billion, US Census Bureau figures show.

Edited by: Wesley Rahn