Korea, US agree to seek 'July package' on tariffs

From left, Minister of Trade, Industry and Energy Ahn Duk-geun, Deputy Prime Minister and Finance Minister Choi Sang-mok, U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer at the U.S. Department of the Treasury in Washington, D.C. Thursday (local time). Courtesy of Ministry of Economy and Finance

By Lee Gyu-lee

• Published Apr 25, 2025 6:14 AM KST
• Updated Apr 25, 2025 2:18 PM KST

Seoul requests exemptions from tariffs in high-level talks in Washington

Korea has requested exemptions from U.S. "reciprocal" and item-specific tariff measures and suggested a package deal to be made by July, Seoul's Ministry of Trade, Industry, and Energy said Friday.

The proposals came during trade talks between the two nations' finance and trade authorities in Washington, D.C., Thursday (local time). Korea’s Deputy Prime Minister and Finance Minister Choi Sang-mok; Minister of Trade, Industry and Energy Ahn Duk-geun; U.S. Treasury Secretary Scott Bessent; and U.S. Trade Representative (USTR) Jamieson Greer took part in the trade consultations following the Donald Trump administration’s "reciprocal" tariffs imposition.

In a press conference following the talks, Choi explained that he expressed willingness to cooperate on the areas that are of major interest to the U.S., such as trade, investment, shipbuilding and energy. He also addressed concerns that the U.S. tariffs could negatively impact economic cooperation between the two countries, especially in the automotive sector.

"We explained that we need calm and orderly negotiations," Choi said, referring to Korea's leadership change following former President Yoon Suk Yeol's ouster and the upcoming snap presidential election slated for June 3.

"The two sides have formed a consensus that Korea will prepare a 'July package' for removal of the tariffs before July 8, when the delay of the reciprocal tariffs is finished."

Choi said they did not discuss the issue of sharing costs for U.S. Forces Korea, but the two sides have established mutual agreement to discuss four key areas of interest: tariffs and nontariff measures, economic security, investment cooperation and foreign exchange policies.

Korea will determine the scope of issues, which were raised during these talks, to be negotiated as the “July package.” This implies that the negotiation will cover the two countries' pending economic issues in a comprehensive manner, with Seoul's incoming administration handling the final deal.

The two sides showed relatively prompt progress in their tariff negotiations, as the ongoing geopolitical developments requires an alliance-level response from the two countries that goes beyond traditional military security to encompass advanced technologies, trade policy and supply chains.

Among the four areas, economic security is gaining attention. Since it is a broad concept that encompasses economic, political and other diplomatic aspects, industry officials speculate that the talks may delve into semiconductors and batteries, supply chain cooperation and export control strategies aimed at containing China's moves.

The deputy prime minister added that more detailed working-level consultations will soon take place between Korea’s industry ministry and the USTR, noting that Greer will visit Korea to attend the Asia-Pacific Economic Cooperation Trade Ministers’ Meeting scheduled for May 15 to 16.

Foreign exchange policies are set to be discussed separately between Korea's Ministry of Economy and Finance and the U.S. Department of the Treasury.

Ahn proposed ways for the two countries to contribute to each other in order to achieve sustainable and balanced trade.

During a separate bilateral meeting between Ahn and Greer following the "two-plus-two” consultations, Ahn requested that the U.S. exclude Korea from the reciprocal tariffs and item-specific tariffs such as on automobiles and steel, along with any new tariffs to be imposed in the future.

The Trump administration began imposing country-specific "reciprocal" tariffs, including 25 percent duties for Korea, on April 9, only to place a 90-day pause on them shortly afterward to allow for negotiations. Its 25 percent levy on automobiles went into effect on April 3, with the same-rate duties on some auto parts set to come no later than May 3.

"As both countries agreed on a framework of consultations through this meeting, working-level meetings will follow next week to decide the consultations' coverage," Ahn said through the ministry.

"We will prudently engage with the U.S. through continuous communication with relevant ministries and industries.”

After the consultations, Bessent described the talks as "very successful," saying during a press availability at the White House following the meeting that Korea’s officials came with their "A-game."

"We will be talking (about) technical terms as early as next week as we reach that agreement on understanding as soon as next week. So the South Koreans came early. They came with their A-game, and we will see if they follow through on that," Greer added.

Ahn said that Korea’s proposal on shipbuilding cooperation drew particular interest from the U.S.

"I think (the U.S.) showed consensus especially regarding the vision for shipbuilding industry cooperation," he said during the press conference.

"Regarding shipbuilding industry cooperation, I believe our explanations about companies' large-scale investments and personnel and technical cooperation aligned well with the U.S. administration's strong desire to strengthen their shipbuilding industry capabilities."