US President Donald Trump announced on Monday that he plans to raise tariffs on South Korea to 25%, accusing Seoul of failing to follow through on the trade agreement signed with Washington last year. The increase would apply to all goods covered under his “reciprocal” tariffs, including automobiles, lumber, and pharmaceuticals.
Trump made the declaration on Truth Social, writing that the US expects trading partners to match America’s swift tariff reductions, and claimed that “South Korea’s Legislature is not living up to its Deal with the United States.” Shares of Hyundai Motor and Kia initially fell 4.6% and 5.9% respectively, while the Korean won weakened from 1,442 to 1,452 per US dollar before moderating.
The original deal, finalized in 2025, reduced many tariffs on South Korean goods to 15% in exchange for Seoul’s $350bn investment pledge in the US. However, confusion persists in South Korea, where President Lee Jae Myung’s office said no official notification had been received from Washington. South Korean lawmakers are reviewing a stalled bill related to the investment component, which the ruling Democratic Party expects to pass next month…
Donald Trump and Lee Jae Myung // Shutterstock