No rush to strike deals with the U.S.

U.S. Treasury Secretary Scott Bessent, who leads the Trump administration’s trade negotiations, announced that talks with South Korea will begin next week. He added that countries that “move first” will have an advantage. The South Korean government plans to respond proactively. However, there is growing concern that Korea could end up making excessive concessions if it rushes to match the U.S.’s pace.

Bessent stated on the 14th that “the country that concludes negotiations first usually secures the best deal” and said the U.S. would review what each country brings to the table before beginning talks. On the same day, Acting President and Prime Minister Han Duck-soo said a negotiation team led by the Minister of Trade, Industry and Energy would soon visit Washington to launch full-scale negotiations.

Recently, President Trump has been pushing for deals with allies such as South Korea, Japan, the United Kingdom, and Australia. The administration likely believes that countries dependent on the U.S. security umbrella will be easier to pressure for greater concessions compared to others driven purely by economic interests. Moreover, the U.S. refuses to present its own demands first, instead waiting to evaluate what others offer before making decisions.

Among U.S. allies, South Korea is in a particularly vulnerable position. Last year, one-fifth of Korea’s exports went to the United States, and 95 percent of its economic growth came from exports. Although there is a 90-day grace period, South Korea faces the highest 25 percent reciprocal tariff rate among America’s allies. Unlike China or the European Union, Korea cannot impose retaliatory tariffs or coordinate with others to buy time.

It would not be a wise strategy for Korea to lay all its cards on the table while hoping for leniency from the U.S. If issues such as defense cost-sharing and trade are lumped into a single package, it could set the stage for the kind of “one-stop shopping” deal Washington prefers. For instance, participating in the Alaska liquefied natural gas project should not be accepted hastily without thorough analysis, given the low likelihood of success relative to the investment involved.

As U.S. inflation spikes, Treasury yields rise, and stock markets waver, President Trump recently postponed planned tariffs on smartphones, computers, and semiconductors. He even hinted at revisiting car part tariffs. The negotiation landscape is shifting rapidly. South Korea needs to pause and take a measured approach. It should start by addressing areas where U.S. interests align with Korea’s, such as shipbuilding cooperation and expanding purchases of U.S. energy.