South Korea strikes gold with Trump’s visit, sealing trade deal

GYEONGJU - South Korea went on a golden offensive to charm US President Donald Trump during his visit to the East Asian country, as the two sides finally agreed on a trade deal after months of deadlock.

The two sides had not been able to agree over the modalities of Seoul’s pledge of US$350 billion (S$453 billion) in investments as part of a framework trade deal struck in July to lower US-imposed reciprocal tariffs of 25 per cent to 15 per cent.

But the deal was “pretty much finalised”, declared Mr Trump at a dinner on Oct 29 that followed his summit with South Korean President Lee Jae Myung in the city of Gyeongju, where the Asia-Pacific Economic Cooperation (Apec) forum is set to be held from Oct 31 to Nov 1.

The dinner was

hosted by Mr Lee and attended by other leaders

, including Singapore’s Prime Minister Lawrence Wong, who are in town for the Apec forum.

The next few days will also see major-power pow-wows, with leaders including Chinese President Xi Jinping and Japanese Prime Minister Sanae Takaichi also attending the Apec meetings.

Mr Xi will be meeting Mr Trump, who is on the last leg of his whirlwind Asia tour, which has already taken him to the

Asean Summit in Kuala Lumpur

and to Tokyo to meet the newly minted Japanese Premier. 

South Korea has pulled out all the stops to receive the US leader, with a gold-themed reception, from Mr Lee’s gold-hued tie to the gift of a replica of a gold crown from the ancient Korean kingdom of Silla.

On the trade agreement, Mr Trump had previously said he expected the US$350 billion investment to be in cash, but Seoul had repeatedly maintained that this would strain its reserves and push it to the brink of a financial crisis.

In a breakthrough, the US agreed that

South Korea could invest US$200 billion in cash

with an annual cap of US$20 billion, while the remaining US$150 billion would be invested to revive the US’ flailing shipbuilding industry.

During negotiations, South Korea has consistently emphasised its potential role in helping the US counter China’s naval dominance with the slogan of “Make American Shipbuilding Great Again”, a spin on Mr Trump’s Make America Great Again slogan.

As part of the deal, South Korea also managed to reduce tariffs on automobiles to 15 per cent, down from 25 per cent. Reciprocal tariffs had already been reduced from 25 per cent to 15 per cent in the July framework agreement and went into effect on Aug 7.

In addition, Mr Lee also scored an in-principle agreement from Mr Trump for South Korea to acquire fuel for nuclear-powered submarines, to help bolster its defences against growing nuclear threats from North Korea. 

South Korea’s use of a gold theme for Mr Trump’s two-day state visit was deliberate.

Mr Lee’s gold-hued tie, which he wore with a grey suit in which he received Mr Trump, was specially customised to symbolise the “golden future” of the South Korea-US alliance, said Mr Lee’s office.

In a ceremony preceding their luncheon meeting at Gyeongju National Museum, Mr Trump was presented with a

replica of an ancient

Silla

kingdom gold crown

, which had the US leader quipping that he “would like to wear it right now”.

The US leader is known for his love of the colour gold. 

When the two leaders first met in the freshly renovated Oval Office in Washington in August, the meeting got off on the right foot when Mr Lee complimented Mr Trump on the new gilded decor. 

But events since then have marred relations between the two allies, making the stakes higher for their second summit.  

Apart from the deadlock in trade talks, the

Sept 4 immigration raid

on the Hyundai Motor Group Metaplant America site in the US state of Georgia, which saw some 300 South Koreans detained, shocked their compatriots back home.

South Koreans felt disrespected that the raid came so soon after Seoul’s hefty investment pledge, which was augmented with a further US$150 billion during Mr Lee’s first summit with Mr Trump in August.  

While Mr Trump had said at the time of the raid that those detained were “illegal aliens” and that the immigration officials were doing their job, he walked back his comments on Oct 27, saying he was “very much opposed” to the raid and that the US needed the crucial foreign-worker expertise. 

Mr Lee, for his part, has consistently called for calm. In a written interview with The Straits Times, he said that South Korea “remains committed to deepening investment and expanding the exchange of talent” even amid stricter US immigration policies. 

The two sides are currently working together to resolve the visa issue. 

At the two leaders’ luncheon meeting, Mr Trump was also conferred South Korea’s highest honour, the Grand Order of Mugunghwa, in recognition of “his contribution to peace on the Korean Peninsula and his continued role as a ‘peacemaker’”, said the presidential office.

The red and gold medal is typically awarded to South Korean presidents, their spouses and heads of state of South Korea’s allies.

The lunch ended with a dessert of a gold-adorned brownie topped with fruits.

It was titled “Peacemaker’s Dessert”, in reference to Mr Lee calling Mr Trump a “peacemaker” for his ongoing efforts to resolve the Korean Peninsula nuclear issue. 

In the run-up to his trip, Mr Trump had been making overtures to North Korean leader Kim Jong Un, including referring to North Korea as a “nuclear power”. But North Korea has remained unresponsive so far.

Mr Kim had previously stated that he was open to meeting Mr Trump again only if the issue of denuclearisation was dropped. 

His Foreign Minister Choe Son Hui’s departure for Russia and Belarus on a visit only expected to end after Mr Trump’s Asia tour was seen as a sign that the much-anticipated Trump-Kim summit would not materialise. 

On Oct 28, a day before Mr Trump’s arrival in South Korea, Pyongyang test-fired sea-to-surface strategic cruise missiles in the Yellow Sea.

In his meeting with Mr Lee, Mr Trump confirmed that the meeting was off the cards. 

He said: “I know Kim Jong Un very well. We get along very well. We really weren’t able to work out the timing. We have – President Xi is coming tomorrow, and it was – that was something that obviously is very important to the world, to all of us.”

While Mr Trump will not stay for the actual Apec summit meetings, he is due to meet Mr Xi in the nearby port city of Busan when the Chinese President arrives on Oct 30.  

He has said that he is confident of striking a deal with Mr Xi, just as he has done with Tokyo and Seoul.

“I think it will be a good deal for both,” Mr Trump said. “The world is watching, and I think we’ll have something that’s very exciting for everybody.”