President Trump has cranked up the heat on South Korea with an announcement of 25% tariffs on major exports, claiming Seoul has failed to honor trade agreement obligations from 2024. The threat encompasses automobiles, pharmaceuticals, and lumber.
The disputed trade and security agreement was finalized in October 2024 after negotiations between Trump and South Korean President Lee Jae Myung. While both leaders initially celebrated the deal, it has since become mired in political disputes.
Korean officials expressed frustration at receiving no diplomatic advance notice of the tariff threat. The government is mobilizing responses including emergency consultations in Washington and expedited legislative action to pass enabling bills.
South Korea’s export-dependent economy is particularly vulnerable to tariff changes, with the automotive industry representing the greatest exposure at 27% of total exports to America. Market reaction included stock price declines.
Trump’s willingness to threaten major tariffs against a key ally demonstrates his continued emphasis on trade policy as a diplomatic weapon. International trade experts warn that volatility creates business uncertainty.