South Korea officials to head to US as trade deal deadline looms
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South Korea and the US are set to resume trade talks as Washington threatens tariffs, with the shipbuilding sector emerging as key to mutual defense and economic cooperation.
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A currency trader walks by a screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room in Seoul, South Korea, on November 21, 2018. (AP)
South Korea’s Deputy Prime Minister Koo Yun-cheol is set to meet with US Treasury Secretary Scott Bessent next week, the presidential office in Seoul announced on Saturday. The meeting comes as the clock ticks toward a looming August 1 deadline to finalize a bilateral trade agreement.
Koo will be joined by Foreign Minister Cho Hyun in talks with Bessent and US Secretary of State Marco Rubio. The announcement follows a high-level briefing in Seoul, where Industry Minister Kim Jung-kwan reported the outcomes of recent discussions with US Commerce Secretary Howard Lutnick.
The renewed diplomatic effort comes amid escalating pressure from Washington, while Trump's administration has threatened to impose a 25 percent tariff on South Korean exports if a trade agreement is not reached by August 1.
In a statement, the South Korean presidential office affirmed that the government "has pledged to devote its full efforts to concluding trade negotiations with Washington before the August 1 deadline."
Shipbuilding sector takes center stage
As discussions resume, South Korea's shipbuilding sector has emerged as a focal point. According to the presidential statement, Seoul confirmed Washington’s "strong interest in the shipbuilding sector" and both sides agreed to enhance cooperation in this strategic industry.
The previously scheduled meeting between Koo and Bessent was postponed last week due to what US officials described as Bessent’s "urgent schedule." However, the upcoming dialogue is expected to be pivotal in shaping the outcome of the trade deal.
South Korea, currently the world’s second-largest shipbuilder behind China, has become increasingly important to US strategic planning in the Indo-Pacific. As tensions rise in the Taiwan Strait, the US is looking to overseas shipyards to bolster its military logistics and fleet operations in the region.
In a landmark development, Hanwha Ocean, one of South Korea’s leading shipbuilders, was authorized in 2024 to conduct dry-dock maintenance on a US Navy vessel, becoming the first non-US firm granted such permission. The move signals deepening US-South Korea defense cooperation and positions South Korea as a key maritime partner.
South Korea warns US chip tariffs threaten economy
A Bloomberg report on July 14 revealed that South Korea is raising urgent concerns over forthcoming US tariffs on semiconductors, an industry that forms the backbone of its export economy.
Trade Minister Yeo Han-koo warned that the planned duties could deal a severe blow to national champions like Samsung Electronics and SK Hynix and potentially disrupt global supply chains.
"We plan to hold extensive consultations with relevant ministries, stakeholders, and the National Assembly to develop a well-prepared proposal, particularly regarding non-tariff barriers and related issues," Yeo stated, adding that another trip to Washington is planned before the deadline.
The semiconductor industry is central to South Korea's economy, accounting for over 19% of its total exports and serving as a key growth driver.
According to Bloomberg, Companies like Samsung and SK Hynix together control more than 60% of the global memory chip market, making them vital not just to Korea's economy but to worldwide tech manufacturing. Seoul views the proposed US sectoral tariffs as a direct threat to this strategic industry.
