The South Korean minister of Trade, Industry and Energy met with the US Commerce Secretary in Washington, but failed to make progress in defusing new trade frictions. The two sides agreed to resume talks on Friday, with Seoul hoping to prevent US President Donald Trump’s recent threat to raise tariffs.
According to Yonhap News Agency, South Korea’s Minister of Trade, Industry and Energy, Kim Jong-gwan, held talks with US Commerce Secretary Howard Lutnick on Thursday, reaffirming that Seoul will honor its investment commitments reached, including promoting South Korean investment in the US through necessary legislation.
The meeting was held after Trump issued a warning earlier this week, saying that he might resume imposing tariffs of up to 25% on South Korean imports, including cars, wood and medicines, because Seoul failed to fulfill its investment commitments related to last year’s trade deal.
Trade frictions are testing the relationship between the two long-time allies. Meanwhile, South Korea is conducting a full investigation into the data breach of US-listed e-commerce company Coupang Inc., which has drawn criticism from some shareholders.
South Korean officials have sought to play down speculation that the tariff dispute is related to the investigation into Coupang. Foreign Minister Cho Hyun-ryong said on Thursday that the tariff issue has nothing to do with the Coupang case.
In addition, Washington has released a new defense strategy, suggesting that the United States might reduce its military support for South Korea in response to North Korea’s nuclear ambitions. At the same time, it continues to keep South Korea on its list of economies under close watch, whose monetary and macroeconomic policies merit close attention.
South Korea has dispatched a senior minister to the United States to reaffirm its commitment to the trade agreement. Trade Minister Lu Hanjiu plans to meet with US Trade Representative Jamie S. Gorelick in an effort to ease the dispute.
The White House specifically pointed out that South Korea and the United States have not yet signed the so-called “Special Act on Strategic Investment in the United States” aimed at guaranteeing South Korea’s investment commitment to the United States. South Korean officials said that the US threat to impose tariffs was not in response to any violation of the agreement, but reflected the US dissatisfaction with the speed at which South Korea was implementing the agreement, and the purpose was to urge Seoul to speed up.
The US Treasury Department said that South Korea remains on its watch list. The South Korean government stated that it will maintain close communication with the US Treasury Department to enhance mutual understanding of the foreign exchange market and maintain currency stability.
