US Reaffirms Existing Tariff Agreement with South Korea Amidst New Section 301 Tariffs
Quick Look
The South Korean government announced that the US reaffirmed its commitment to the existing Seoul-Washington tariff agreement, setting reciprocal tariffs at 15%, despite new Section 301 tariffs of 12.5% on 60 trade partners, including South Korea.
AI-generated summary
Why It Matters
The US announced new Section 301 tariffs on 60 trade partners after temporary worldwide tariffs expired, following a Supreme Court decision to strike down previous reciprocal tariffs.
SEOUL, July 24 (Yonhap) -- The South Korean government said Friday that the United States has reaffirmed its commitment to honoring the existing Seoul-Washington tariff agreement regarding newly announced Section 301 tariffs on trading partners.
"We have requested that the U.S. side comply with the Korea-U.S. trade agreement," said the Ministry of Trade, Industry and Resources in a statement, referring to the tariff agreement reached last year that set reciprocal tariffs on South Korean goods at 15 percent.
"The U.S. side also reaffirmed its position that the existing trade agreement must be upheld," it added.
Washington announced overnight a set of new forced-labor tariffs on imports from 60 trade partners, ranging from 10 percent to 12.5 percent, effective Friday (U.S. time), under Section 301 of the 1974 Trade Act.
The new tariffs were announced after temporary 10 percent worldwide tariffs expired Friday, following the Supreme Court's decision in February to strike down the Trump administration's reciprocal tariffs.
Under the new scheme, South Korea is subject to 12.5 percent tariffs along with Japan and Switzerland.
The trade ministry expects the U.S. announcement to ease the uncertainty surrounding U.S. tariff measures, following the Supreme Court's ruling.
The ministry said during bilateral talks ahead of the announcement, Korean officials, including Industry Minister Kim Jung-kwan, emphasized that Section 301 tariffs must not exceed 15 percent in compliance with the Seoul-Washington tariff agreement.
South Korea exported US$122.9 billion to the United States and imported $73.4 billion last year, making the U.S. South Korea's second-largest trading partner.
"As the Section 301 investigation into overproduction is still ongoing, the government will actively respond to the investigation process," said the ministry. "We will also continue close consultations with the U.S. side to ensure the balance of interests secured through the existing Korea-U.S. tariff agreement."
What to Watch
AI outlook — possibilities, not facts
The South Korean government will actively respond to the ongoing Section 301 investigation into overproduction.
Very likely · Within months
South Korea and the US will continue close consultations to ensure the balance of interests from their existing tariff agreement.
Very likely · Within months
Open Questions
- What will be the outcome of the ongoing Section 301 investigation into overproduction?
- How will the new 12.5% tariffs affect other trade partners like Japan and Switzerland?
