Washington and Seoul strike 11th-hour trade deal: Tariffs cut to 15%, $350 billion South Korean investment pledged

08/04/2025 / By Laura Harris

South Korea and the U.S. reached a last-minute trade deal reducing proposed U.S. tariffs on Korean exports, including automobiles, from 25 percent to 15 percent.
Korea pledged to invest $350 billion in the U.S., with details to be announced at an upcoming summit between Presidents Lee Jae Myung and Donald Trump.
While Trump claimed Korea agreed to open its markets to U.S. agricultural goods, Seoul emphasized that it made no concessions on sensitive rice and beef imports.
The agreement includes Korea’s commitment to purchase $100 billion in U.S. LNG and invest in sectors like semiconductors, batteries and shipbuilding.
Lee hailed the deal as a turning point and stressed the need for flexible, interest-driven diplomacy amid global trade realignments.

South Korea and the United States have reached a trade agreement that lowers proposed U.S. tariffs on Korean exports to 15 percent, down from the initially announced 25 percent, in an 11-hour breakthrough.

The deal, finalized in Washington and announced by both governments on July 30, includes a pledge from Korea to invest $350 billion in the U.S. economy, with full details expected during a planned summit between President Lee Jae Myung and U.S. President Donald Trump in two weeks.

In a press briefing on July 31 at the Yongsan presidential office in Seoul, Presidential Chief of Staff for Policy Kim Yong-beom announced that under the deal, tariffs on key Korean export items, including automobiles, will be set at 15 percent. (Related: Trump announces “massive” trade deal with Japan: Lower 15% import tariffs in exchange for $550 billion investment.)

Trump heralded the agreement on his Truth Social platform as a “full and complete” deal, declaring that the U.S. had secured a 15 percent tariff rate on South Korean goods and that “America will not be charged a Tariff.” In his post, Trump also announced Korea would invest $350 billion in the U.S., particularly in sectors “selected” by his administration, including a purchase commitment of $100 billion in American liquefied natural gas (LNG) and other energy products.

“I am pleased to announce that the United States of America has agreed to a full and complete trade deal with the Republic of Korea. The deal is that South Korea will give to the United States $350 billion for Investments owned and controlled by the United States, and selected by myself, as President. Additionally, South Korea will purchase $100 billion of LNG, or other Energy products and further, South Korea has agreed to invest a large sum of money for their investment purposes,” Trump posted.

However, Kim argued that Korea avoided making concessions on its highly sensitive rice and beef markets, despite Trump claiming that they had agreed to fully open its markets to American goods, including agricultural products.

“It’s true that during our discussions with the United States, there was a strong demand to open our agricultural and livestock market,” Kim said. “However, considering food security and the sensitivity of agriculture, we agreed not to further open the domestic rice and beef markets.”

Lee hails U.S. trade deal as turning point, urges pragmatic diplomacy

After the success of the trade deal, Lee expressed his gratitude to the officials involved in the tariff negotiations, thanking them for their “tireless efforts” in securing the trade agreement.

“The Korea-U.S. tariff negotiations have finally concluded,” Lee said during a meeting with senior presidential aids the next day. “These negotiations are believed to have significantly resolved uncertainty in the trade environment. We anticipate that economic cooperation and the alliance between Korea and the U.S. will further strengthen.

“While we have overcome a significant obstacle, the restructuring of the international trade order is expected to continue accelerate. We must wisely navigate the rapidly changing external environment through flexible, pragmatic diplomacy focused on national interests.”

Lee then stated that the promised investment would support Korean companies’ entry into the U.S. market across strategic industries such as semiconductors, shipbuilding, rechargeable batteries, energy and biotechnology.

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