The White House announced on November 13 that the United States and South Korea have finalised a joint fact sheet outlining agreements on trade and security matters, following the summit of President Donald Trump and South Korean President Lee Jae Myung in October.
Last month, Lee met Trump in Gyeongju, South Korea, and reached an agreement to reduce U.S. import duties on South Korean goods from 25% to 15%.
US-South Korea deal details
The US will impose either the higher rate under the U.S.-Korea Free Trade Agreement or the Most Favoured Nation (MFN) tariff, or a 15% tariff on South Korean goods, under its reciprocal tariff policy, the White House said on November 13. For pharmaceuticals, the tariffs will not exceed 15%.
South Korea will construct nuclear-powered submarines and collaborate with the US in shipbuilding, artificial intelligence, and the nuclear sector, Lee said during a televised briefing.
The deal includes $150 billion of Korean investment in the shipbuilding sector approved by the United States, which is referred to as the Approved Investments. It further involves an additional $200 billion in Korean investments, as pledged in the Memorandum of Understanding (MOU) on Strategic Investments, which is anticipated to be signed by US and South Korean representatives.
The two leaders expressed their support for the August announcement made by South Korean companies, which revealed foreign direct investments in the United States totalling $150 billion during President Trump’s tenure. Both nations will make every effort to support and promote these investments, White House noted.
The two leaders lauded Korean Air (KAL)’s order of 103 Boeing aircraft equipped with GE Aerospace engines. Valued at around $36 billion, the order comprises a variety of Boeing models, including the 737 MAX, 787 Dreamliner, and 777X passenger and freighter aircraft. This purchase will bring KAL’s total Boeing orders in 2025 to over 150 airplanes.
Additionally, the deal highlighted the Buy America in Seoul initiative, whereby South Korea, in collaboration with state governments, will organise an annual exhibition featuring US companies, including Small and Medium-sized Enterprises, to promote the export of American goods into Korea.