Seoul, Washington lay groundwork for tariff relief deal by July
South Korea and the US have agreed to work toward a “July Package," a comprehensive package deal aimed at eliminating US tariffs on Korean exports before July 8, when the 90-day grace period on US "reciprocal tariffs" expires, according to Korea’s top officials on Friday.
The agreement came during a “2+2” trade meeting in Washington on Thursday, between South Korean Deputy Prime Minister and Finance Minister Choi Sang-mok, Industry Minister Ahn Duk-geun and their US counterparts, Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer. The meeting was held at the US Department of the Treasury in Washington DC, lasting for a total of 1 hour and 8 minutes to conclude at 10:18 a.m.
At a press conference with Korean reporters following the bilateral meeting, Choi confirmed that both sides agreed to focus their discussions on four main areas: tariffs and non-tariff barriers, economic security, investment cooperation and exchange rate policy.
“The meeting helped narrow down the agenda and build consensus on a schedule, effectively establishing the framework for the negotiations,” Choi said.
"We explained the various domestic considerations that could affect the negotiations and asked for the US' understanding, including the country's political schedule, trade-related laws and the need for coordination with the National Assembly."
With Korea set to hold a presidential election on June 3 following the impeachment of former President Yoon Suk Yeol earlier this month, the government is expected to finalize the agreement package after the new administration takes office.
The Korean ministers said they delivered their commitment to cooperation on key US interests, including trade investment, shipbuilding and energy.
Ahn also said he requested the removal of reciprocal tariffs and item-specific tariffs on automobiles and steel in a separate meeting held with Greer.
US President Donald Trump implemented a 25 percent tariff on steel and aluminum starting March 12. On April 3, a 25 percent tariff on foreign automobiles took effect, with tariffs on auto parts scheduled to begin on May 3.
"Through this meeting, Korea and the US reached a basic agreement on the framework for future negotiations," Ahn said, noting that they agreed to form multiple working groups to facilitate future talks.
Once working-level talks begin next week, the two sides will determine the scope of issues to be included in the July Package, Ahn added.
Regarding Bessent's comment that "South Korea brought its A-game and we will be watching to see if it follows through," Ahn suggested that the remark likely reflected the consensus formed around Korea's proposal for cooperation in the shipbuilding sector.
Before the ministers' press conference, Bessent had said the trade talks with Korea were "very successful."
Additional high-level talks are scheduled with Greer, who will visit Korea for the APEC Trade Ministers’ Meeting in Seoul May 15-16.
On April 2, Trump also signed an executive order imposing a 10 percent base tariff on all trading partners, with an additional country-specific tariff ranging from 10 percent to 50 percent. The total reciprocal tariff of 25 percent was imposed on Korea, but has been granted a 90-day grace period.
Meanwhile, the talks did not cover the issues of renegotiating defense cost-sharing, or the existing free trade agreement.
With a boost in sentiment following the tariff negotiation, the Korean won opened slightly stronger against the US dollar on Friday. In the Seoul foreign exchange market, the won-dollar exchange rate started the day at 1,432.0 won per dollar, down 3.0 won from the previous session’s close.
The Kospi also opened slightly higher at 2,544, supported by foreign and institutional buying. Gains in shipbuilding stocks like HD Hyundai Heavy Industries and Hanwha Ocean, along with strong performances in petrochemical shares like Aekyung Chemical and Hanwha Solutions, helped lift the index.
As of 2:30 p.m. Friday, HHI was trading at 400,000 won ($278), up 6.38 percent from the previous day's close. Shares of HD Korea Shipbuilding & Offshore Engineering were at 264,500 won, up 6.01 percent, while Hanwha Ocean was trading at 89,000 won, marking a 10 percent gain.
Aekyung Chemical's shares also soared, jumping 29.99 percent to 10,350 won.
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