Trump Pressures South Korea with 25% Tariff Demand Over Trade Agreement Stalemate

President Trump has pressured South Korea with a demand for action, threatening 25% tariffs on major exports over a stalemate regarding a trade agreement from 2024. The announcement targets automobiles, pharmaceuticals, and lumber among key product categories.
The disputed agreement was finalized between Trump and South Korean President Lee Jae Myung in October 2024, featuring provisions for reduced US tariffs on Korean vehicles. However, disagreements about whether legislative ratification is required have prevented full implementation.
Korean officials expressed surprise at Trump’s public threat, noting they received no advance diplomatic notification. The government is mobilizing responses including emergency consultations in Washington and expedited parliamentary action on five enabling bills.
South Korea’s export-oriented economy is particularly vulnerable to tariff changes, with the automotive industry representing the greatest exposure. When Trump’s tariff threat became public, shares in Korean carmakers fell sharply before recovering some ground.
Trump’s willingness to threaten tariffs against a key Asian ally demonstrates his continued emphasis on trade policy as a diplomatic tool. While some threatened tariffs are never implemented, international trade experts note that volatility itself imposes economic costs.