U.S. signals tariffs, cash investment from South Korea

U.S. President Donald Trump on Sept. 25 (local time) referred to South Korea’s planned $350 billion investment fund in the United States, saying, “This is upfront.” While the South Korean government has said only part of the fund would involve direct investment, with the majority focused on loans and guarantees, analysts said Trump’s comments appeared to pressure Seoul for actual cash investments. Trump also signaled high tariffs on imported pharmaceuticals, large trucks, kitchen cabinets and bathroom fixtures, and upholstered furniture.

The South Korean presidential office had previously praised the trade talks after the Aug. 25 South Korea-U.S. summit, saying the negotiations went smoothly and that no formal agreement was strictly necessary. However, a month after the summit, differences remain over the U.S.-bound investment fund. Additional potential tariffs on pharmaceuticals and other products have also increased the burden on South Korean companies.

At the White House in Washington, D.C., after signing an executive order related to an agreement with the Chinese video platform TikTok, Trump said, “We have not been treated properly by other countries, but now we are doing very well,” citing tariffs and trade deals as reasons. He added, “We earned $950 billion from one place (the European Union), which we never got before. In Japan, it’s $550 billion, and in Korea, $350 billion. This is upfront.”

U.S. Commerce Secretary Gina Raimondo reportedly told Korean officials in recent talks that the South Korean investment should be increased beyond $350 billion to more closely match Japan’s $550 billion, the Wall Street Journal reported Sept. 25. Raimondo also reportedly told Korean officials that she wanted more of the U.S.-bound funds in cash rather than in loan form.

Amid ongoing differences and U.S. pressure, Trump later announced on Truth Social that, starting Oct. 1, all branded pharmaceuticals imported from Korea, including generics marketed under specific brand names and patented drugs, would face a 100% tariff. However, he said the tariffs would not apply to drugs produced by companies that have already started or are currently constructing factories in the United States.

Trump also said that, starting Oct. 1, imported large trucks would face a 25% tariff, kitchen cabinets and bathroom sinks and related products a 50% tariff, and upholstered furniture a 30% tariff.


Jin-Woo Shin niceshin@donga.com