In a positive development following their initial round of trade talks, South Korea and the United States have agreed to work towards a comprehensive trade package aimed at removing new U.S. tariffs, with a deadline set before the reciprocal tariff pause ends in July, according to South Korea’s delegation in Washington.
U.S. Treasury Secretary Scott Bessent described the talks, which took place on Thursday, as “very successful,” adding that discussions may progress rapidly, with technical discussions expected as soon as next week. Bessent and U.S. Trade Representative Jamieson Greer met with South Korean Finance Minister Choi Sang-mok and Industry Minister Ahn Duk-geun to begin the negotiation process.
While both parties refrained from detailing potential agreements, South Korea highlighted its requests for exemptions from reciprocal and item-specific tariffs, and expressed a willingness to collaborate in sectors such as shipbuilding, energy, and addressing trade imbalances. Minister Ahn emphasized the importance of these early discussions, noting that working-level talks will continue next week to shape the framework for a “July package” by July 8.
Further talks are scheduled to take place in South Korea on May 15-16, with Greer joining Minister Choi. These discussions will focus on four key areas: tariffs and non-tariff measures, economic security, investment cooperation, and currency policy.
Despite the optimism expressed by the U.S., experts caution that a deal may be unlikely before South Korea’s upcoming presidential election in June. Heo Yoon, an international trade professor at Sogang University, noted that South Korea’s cautious approach contrasts with the U.S.’s fast-paced progress in these negotiations.
One significant focus of the talks is the automotive sector, which has been heavily impacted by tariffs, with South Korea facing 25% reciprocal tariffs on its vehicles. Discussions on currency policy are also expected, as U.S. Treasury Secretary Bessent is set to meet with South Korea’s finance ministry separately on this issue.
Notably, the talks did not address the contentious issue of defense costs, a topic previously raised by President Donald Trump. Trump had suggested that discussions regarding U.S. troop deployments in South Korea could be part of broader trade negotiations. However, South Korea’s Foreign Minister maintained that defense issues remain separate from trade matters.
Additionally, there was no mention of renegotiating the bilateral free trade agreement (FTA) that was signed in 2007 and revised during Trump’s first term. The South Korean delegation stressed that the process could be influenced by the country’s political landscape, particularly the June election. The acting president, Han Duck-soo, expressed a willingness to finalize a deal, stressing South Korea’s historical debt to the U.S. following the Korean War. However, this stance has faced criticism from opposition parties, who argue that the acting president may be rushing negotiations for political gain.
South Korea’s energy policy also remains a point of discussion, with the U.S. pushing for commitments to energy projects such as the Alaska LNG project. However, Ahn confirmed that South Korea is still reviewing the project and engaging with other major LNG importers like Japan, Taiwan, and Vietnam.
Lastly, the U.S. raised concerns about non-tariff barriers in South Korea’s digital services sector, referencing a 2025 U.S. report that identified issues related to network usage payments, competition regulations, and restrictions on data transfers and location data exports.
As both countries continue to negotiate, the coming weeks will be crucial in determining whether they can reach a comprehensive trade agreement before the deadline in July.
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