The 15 percent tariffs on Korean imports to the United States (down from the 25 percent rate first proposed) will make it harder for Korean firms to sell in the American market. But as Robert Atkinson writes in The Korea Times, if Korea plays its cards right, it perhaps can turn this into a temporary, rather than a permanent, setback.
To do that, Atkinson says the Lee Jae Myung administration should focus on what the Trump administration cares about most: the bilateral trade deficit between the United States and other nations.
In 2023, U.S. imports from Korea totaled $120 billion, with vehicles making up 35 percent, followed by machinery (21 percent), electronics (15 percent), and chemicals (12 percent). In contrast, U.S. exports to Korea totaled just $61 billion. Reducing that $59 billion deficit to zero could give Trump the political win he wants, and allow Korea to later renegotiate for lower tariffs.
Atkinson lays out ways to get there while minimizing harm to Korea’s industrial competitiveness:
- Accelerating the Korean government’s commitment that its companies will make a $350 billion investment in the United States
- Encouraging more U.S. imports of LNG, Boeing jets, agricultural goods, and defense products by reducing imports from other nations and substituting them with U.S. products
- Addressing U.S. concerns mentioned in the USTR National Trade Estimates report, including ICT procurement, cloud services, network usage fees, and competition rules for internet platforms
The payoff: By 2028, Korea could reach trade balance and then push for a fairer deal. In Atkinson’s view, it’s a long game worth playing.
Read the commentary in The Korea Times.
