South Korea, US aim for package deal before tariff pause ends in July, Seoul says

SEOUL/WASHINGTON – South Korea and the United States agreed to craft a package of deals aimed at removing new US tariffs before the pause on reciprocal tariffs are lifted in July, Seoul’s delegation said after the first round of trade talks in Washington.

The US and South Korea had a “very successful” meeting on April 24, US Treasury Secretary Scott Bessent said afterwards.

“We may be moving faster than I thought, and we will be talking technical terms as early as next week,” he told reporters.

Mr Bessent and Trade Representative Jamieson Greer met South Korean Finance Minister Choi Sang-mok and Industry Minister Ahn Duk-geun.

South Korea said in a statement it requested exemptions from reciprocal and item-specific US tariffs, and offered cooperation on shipbuilding and energy as well as addressing trade imbalances.

“I think we had a very good start today,” Mr Ahn later told reporters. “We also agreed to hold working-level talks next week to determine the scope and structure of talks, with the goal of producing a ‘July package’ by the July 8 deadline.”

Mr Choi said more talks will be held in Seoul on May 15-16 with Mr Greer.

“Discussions will focus on four key areas: tariffs and non-tariff measures, economic security, investment cooperation and currency policy,” Mr Choi said.

Despite US optimism, trade experts expect the two sides to be unlikely to reach a deal before South Korea’s June presidential election.

“It seems that South Korea is in cautious mode, while the US is on a fast track,” said Dr Heo Yoon, an international trade professor at Sogang University in Seoul.

Former trade minister Yeo Han-koo said there is a discrepancy in how the two sides perceive the progress in negotiations, with South Korea suggesting that it may push for the trade package close to the July deadline, while Mr Bessent flagged “an agreement on understanding” as soon as next week.

“The term ‘July package’ suggested that Korea would not rush to a deal,” Mr Yeo said. “There is a question mark as to whether the US has agreed to it.”

Autos in focus

Mr Bessent and other trade team members from President Donald Trump’s administration met this week in Washington with foreign finance and trade officials looking to strike tariff deals on the sidelines of meetings of the International Monetary Fund and World Bank Group.

South Korea, which faces 25 per cent US reciprocal tariffs, is among the first countries the Trump administration has initiated trade talks with, after its first face-to-face discussions last week with Japan, another key Asian ally hit with 24 per cent tariffs.

Mr Bessent was also due to meet Japanese officials on April 24.

Mr Choi said South Korea focused in particular on the automobile sector, which faces the greatest negative impact.

He also said South Korea’s Finance Ministry and US Treasury will hold separate discussions on currency policy.

Mr Choi told South Korean reporters that there was no mention of defence costs during the talks.

Mr Trump has previously said that sharing the cost of keeping US troops in South Korea would be part of “one-stop shopping” negotiations with Seoul.

But South Korea’s Foreign Minister said defence costs are separate matters from trade talks.

Mr Ahn said there was no mention of the renegotiations of a bilateral free trade deal signed in 2017.

The South Koreans also asked for understanding from the Americans that the process could be affected by the “political schedule”, apparently referring to the looming June 3 snap election in South Korea, which was called after Yoon Suk Yeol was ousted for his role in imposing martial law in December.

Acting President Han Duck-soo has expressed willingness to reach a deal, saying the country will not fight back against Washington as it owes the US for its recovery from the 1950-1953 Korean War.

That has faced pushback from the main liberal Democratic Party who are favoured to win in the election, accusing the conservatives under Mr Han of rushing talks for political gain.

The party’s spokesperson Cho Seung-rae called on Mr Han to “immediately stop” the negotiations.

Experts have also noted it may be difficult for South Korea to make any firm commitment on energy projects and defence costs under an acting president.

“The prime minister of the impeachment government has no mandate from the Korean people to commit to a deal,” Dr Yeo said.

Mr Trump’s energy security council plans to host a summit in Alaska in early June, when it hopes Japanese and South Korean officials will announce commitments to the Alaska LNG project, a source familiar with the matter said on April 25.

Mr Ahn said he was not aware of a plan to announce any commitment from South Korea.

South Korea is reviewing the project and in discussions about its feasibility with other major LNG importers like Japan, Taiwan and Vietnam.

The United States also raised the issue of non-tariff barriers in the digital services sector that it had cited in a 2025 report, South Korea said.

The US report said South Korean legislation that required network usage payments, regulated competition, and restricted personal data transfers and location data exports amounted to non-tariff barriers in the digital services sector. REUTERS