Trump Hits South Korea With Higher Tariffs as Trade Talks Stall

By Staff, Agencies

US President Donald Trump on Monday raised tariffs on South Korean imports, blaming Seoul’s lawmakers for stalling last year’s trade agreement.

The hike lifts tariffs on autos [vehicles], lumber, pharmaceuticals, and other goods from 15% to 25%, undoing cuts that had been implemented in November.

Trump said he and South Korean President Lee Jae Myung reached "a Great Deal" in July 2025, reaffirmed in October, but claimed it wasn’t implemented, and announced on Truth Social that tariffs on South Korean imports would rise from 15% to 25%.

South Korean officials said the decision came as a surprise, underscoring fresh strain in an alliance already navigating trade, security, and financial pressures amid Trump’s second term.

Last year’s deal had South Korea investing up to $350 billion in the US in exchange for tariff cuts on autos and parts, lowering rates from 25% to 15%.

A source said the tariff hike may relate to South Korea’s recent actions against “Coupang” [a US-listed e-commerce firm calling the measures unfair and discriminatory], as Washington and Seoul discuss US concerns over tech regulations under the trade framework.

Choi Seok-young, a former South Korean trade negotiator, described Trump’s message as “a political move” aimed at exerting maximum pressure to extract concessions during negotiations over non-tariff barriers.

South Korea’s benchmark KOSPI swung to a 1.3% gain, the won fell 0.5%, and Hyundai and Kia shares partially recovered; General Motors exports 500,000 vehicles annually to the US.

Seoul said it hadn’t received formal notice of the tariff hike; the industry minister will visit the US, and a presidential advisor will coordinate ministries to explore options.

As South Korea’s parliament prepares to reconvene on February 3, the country’s 2025 exports hit a record $709.4 billion, with $122.9 billion to the US; auto exports, $30.2 billion, would face the biggest impact from higher tariffs.

Under last year’s framework, South Korea pledged $350 billion in US investments, but Finance Minister Koo Yun-Cheol said the package is unlikely in H1 2026 amid currency weakness and uncertainty over Trump’s tariffs, prompting Seoul to consult parliament as the won nears 2007–2009 crisis levels.

Josh Lipsky of the Atlantic Council said the tariff hike reflected Trump’s impatience with implementation and underscored ongoing trade-policy uncertainty, noting markets were wrong to expect tariff stability in 2026.