South Korea strikes favorable tariff deal with US, presidential office says

Kim Yong-beom policy chief of the presidential office answers to the media after briefing how South Korea and the US reached a comprehensive trade agreement on tariff measures Yongsan Presidential Office July 31 2025 Yonhap — Kim Yong-beom, policy chief of the presidential office, answers to the media after briefing how South Korea and the U.S. reached a comprehensive trade agreement on tariff measures, Yongsan Presidential Office, July 31, 2025. Yonhap

SEOUL, July 31 (AJP) - South Korea's presidential office said Thursday it secured a more favorable agreement than Japan in tariff negotiations with the United States, successfully limiting concessions while protecting key domestic markets.

The announcement came after President Lee Jae-myung and US President Donald Trump revealed on social media that bilateral tariff talks had concluded with mutual 15 percent rates.

The U.S. had initially planned to impose 25 percent reciprocal tariffs starting August 1, but these will be reduced to 15 percent under the new agreement. Kim Yong-beom, policy chief of the presidential office, said the deal included 15 percent tariffs on South Korean automobiles, though Seoul had argued for 12.5 percent until the final stages.

The agreement establishes a $350 billion investment fund, with $150 billion dedicated to shipbuilding cooperation covering vessel construction, maintenance, and maritime equipment. An additional $200 billion fund will target semiconductors, nuclear power, secondary batteries, and biotechnology sectors where South Korean companies hold competitive advantages.

Kim described the $200 billion as a "ceiling concept" with most funding expected to come through loans and guarantees rather than direct investment. The policy chief compared South Korea's deal favorably to Japan's earlier agreement, noting Korea's $350 billion commitment was smaller than Japan's $550 billion despite similar trade surplus levels.

Excluding the shipbuilding fund led by Korean companies, South Korea's investment commitment represents just 36 percent of Japan's total, Kim noted. "We analyzed Japan's negotiations precisely and included far more safeguards in our agreement," Kim said.

The agreement includes most-favored-nation treatment for future semiconductor and pharmaceutical tariffs, ensuring South Korea receives equal treatment with other countries.

Kim added that South Korea successfully defended domestic rice and beef markets from additional opening requirements despite strong U.S. pressure, while topics such as defense cost-sharing, weapons purchases, and high-precision map data issues were not included in this agreement.

Officials say specific dates for the Korea-U.S. summit promised by Trump within two weeks would be arranged through diplomatic channels.

Kim Dong-young davekim0807@ajupress.com