South Korea's trade surplus with the United States is poised to exceed $100 billion for the first time this year, driven by a surge in exports of semiconductors and electrical equipment amid a booming artificial intelligence (AI) industry. However, concerns are rising that the Trump administration's push to address trade imbalances could increase pressure on South Korean investments in the U.S.
According to relevant government departments, the cumulative trade surplus with the U.S. from January to September this year stands at approximately $84.7 billion. This figure significantly surpasses the previous annual record of $55.6 billion set in 2024, as well as last year's surplus of $49.5 billion.
The trade surplus with the U.S. decreased from $17.9 billion in 2017 to $13.9 billion in 2018 and $11.4 billion in 2019, before rebounding to $16.6 billion in 2020. It then rose to $22.7 billion in 2021, $28 billion in 2022, and $44.4 billion in 2023, reaching $55.6 billion in 2024.
To reach the $100 billion mark by the end of the year, South Korea needs to achieve a surplus of $15.3 billion over the next three months, averaging $5.1 billion per month. Given that the average monthly surplus from January to September was about $9.4 billion, this target appears attainable.
The expansion of the surplus has been influenced by increased investments in AI infrastructure in the U.S. According to the Ministry of Trade, Industry and Energy, exports to the U.S. surged to $24.33 billion last month, a 137% increase from the previous year. Notably, semiconductor exports to the U.S. from the 1st to the 25th of last month skyrocketed by 675% compared to the same period last year, driven by increased investments in data centers.
However, the growing trade surplus could lead to additional trade pressures from the U.S. President Trump has identified trade deficits as a key issue, demanding tariffs and increased investments from trading partners, including South Korea. Last year, South Korea agreed to reduce tariffs to 15% in exchange for committing $350 billion in investments in the U.S.
Recently, the two countries confirmed plans to construct a gas-fired power plant in Texas and agreed to collaborate on building eight large nuclear power plants in the U.S. The remaining issue is the development of liquefied natural gas (LNG) in Alaska. While President Trump has made statements suggesting South Korea's participation is a given, the joint fact sheet released by both countries only indicates that discussions will begin.
The Ministry of Trade, Industry and Energy has stated that it will assess the feasibility of the project based on commercial viability and compliance with domestic laws. The U.S. has committed to supporting South Korean companies with equipment supply, economically viable long-term LNG purchase contracts, and priority access to Alaska's LNG if the project proceeds.
While an expanding trade surplus does not necessarily lead to additional tariffs, the Trump administration has used trade deficits as a key basis for trade negotiations. Therefore, the South Korean government must prepare for potential U.S. concerns regarding the surplus. Explaining how increased U.S. investments in AI have boosted demand for South Korean semiconductors and electrical products, while ensuring the economic viability of specific investment projects, will be crucial in future trade negotiations.
* This article has been translated by AI.
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