What are Korea's bargaining chips against Trump's reciprocal tariffs?

Industry Minister Ahn Duk-geun, second from right, talks with U.S. Commerce Secretary Howard Lutnick, second from left, at a hotel in Washington, March 22 (local time). Courtesy of Ministry of Trade, Industry and Energy

The Korean private sector's ongoing investments in the United States are expected to help Seoul to secure favorable results in its negotiations with Washington to lower tariffs as much as possible, international trade experts said, Monday.

The experts advised the government to emphasize Korea's contribution to the U.S. economy, as the White House has pointed to nontariff barriers and trade imbalances to justify its forthcoming reciprocal tariffs on free trade partners.

"The government should show proof that Korean products have contributed to the U.S. industry and job market," said Kim Dae-jong, a professor of business administration at Sejong University.

Chang Sang-sik, head of the Institute for International Trade under the Korea International Trade Association, said that Korea should position itself as an irreplaceable ally as the U.S. has excluded Chinese products.

U.S. President Donald Trump speaks to reporters aboard Air Force One on his return to Washington, Sunday (local time). Reuters-Yonhap

Initially, the government sought an exemption from reciprocal tariffs, citing the Korea-U.S. Free Trade Agreement (KORUS FTA), which makes almost all goods tariff-free. However, U.S. President Donald Trump has reiterated that his administration will start imposing reciprocal tariffs on all countries without exception on April 2.

Trump stated that negotiated deals would be impossible before the announcement of the sweeping tariffs, although he is open to negotiations afterward if the U.S. could "get something" in return.

"You'd start with all countries," he told reporters aboard Air Force One on Sunday (local time), referring to the reciprocal tariffs he is set to announce this week.

Additionally, Korea is presumed to be on the list of the so-called "Dirty 15," the 15 countries that U.S. Treasury Secretary Scott Bessent identified as imposing high tariffs on American goods.

As it has become virtually impossible for Korea to avoid U.S. reciprocal tariffs, the government has shifted its focus to convincing the U.S. to impose lower tariffs on Korean products than on those from Japan and European Union member countries, so that Korean goods could have price competitiveness.

"Tariff rates can differ depending on the package we can offer," Trade Minister Cheong In-kyo said during a lecture in Seoul on March 19, following his meeting with U.S. Trade Representative Jamieson Greer.

Hyundai Motor Group Executive Chair Chung Euisun, front row right, poses for a selfie with Georgia Gov. Brian Kemp, front row left, and the employees of the Hyundai Motor Group Metaplant America, during the factory's grand opening in Ellabell, Ga., Wednesday (local time). AP-Yonhap

One factor considered favorable for trade talks is Hyundai Motor Group's plan to invest $21 billion in the U.S. to build manufacturing facilities. During a White House meeting on March 24 with Executive Chair Chung Euisun of the Korean automotive group, Trump welcomed the plan, saying Hyundai Motor would not have to pay any tariffs.

Two days later, however, Trump signed a proclamation imposing 25 percent tariffs on all foreign-made cars starting April 3. As a result, Hyundai's vehicles shipped from Korea will be subject to the universal car tariffs.

"Companies should clarify that they will produce major components and intermediary goods in the U.S. or source them from U.S. companies," Chang said. "Korea should also signal its intent to cooperate with the U.S. in various sectors, including shipbuilding, solar power, semiconductors and energy."

Amid the U.S. request to resolve trade imbalances, Korean Air recently decided to buy a combined $32.7 billion worth of aircraft and engines from Boeing and GE Aerospace. However, Washington is still urging Korea to import more U.S. products, including liquefied natural gas from Alaska.

During his visit to Seoul last week, Alaska Gov. Mike Dunleavy told the press that Korea's gas imports from his state would be a prerequisite for favorable trade talks with the U.S. His remarks came as the government remained undecided on the request.

Additionally, Korea's plan to regulate monopolistic online platforms, including U.S. Big Tech companies, its ban on the import of American beef from cattle aged 30 months or older and the screen quota system to protect domestic filmmakers are seen by the U.S. as nontariff barriers that justify its reciprocal tariffs.

Some critics point out that Korea should voice complaints about U.S. protectionist policies, as the government refused the EU's request to cooperate in counteracting Trump's tariff threats.

Korea chose to remain low-key to avoid becoming the main target of the U.S., unlike the EU and Canada, both of which are preparing retaliatory tariffs on American products after their trade talks with Washington proved fruitless.

On Thursday, Japan's Chief Cabinet Secretary Yoshimasa Hayashi also called the U.S. decision to hike the car tariffs with no exceptions "extremely regrettable."

"It is worthwhile to consider imposing retaliatory tariffs as a last resort," Kim said. "If the government remains silent, it can be seen as consenting to the U.S. tariff policies."