US and South Korea Finalize Major Trade Deal

President Donald Trump and South Korean President Lee Jae Myung on Wednesday confirmed they have “pretty much finalised” a sweeping trade agreement as part of Trump’s Asia tour.

The deal involves a $350 billion investment package from South Korea into the U.S. — split into $200 billion in cash investment and $150 billion in shipbuilding cooperation.

In exchange, the U.S. will reduce auto and auto‑parts tariffs on South Korean exports from 25% down to 15%. South Korea’s major automakers welcomed the agreement, highlighting how the reduced tariffs ease export pressure. The South Korean won strengthened slightly after the announcement, reflecting improved market sentiment.

Why It Matters

The deal breaks a stalemate in U.S.–South Korea trade talks, which had seen months of deadlock over tariffs and investments.

It signals Washington’s strategy of tying tariff relief to large‑scale foreign investments and industrial cooperation (in this case, shipbuilding and cash flows into the U.S.).

With the U.S. and China also poised to meet this week (Trump and Xi Jinping are set to meet), this deal adds momentum to U.S. trade diplomacy. Trump said the upcoming Xi meeting is “going to work out very, very well for everybody.”

South Korea and the U.S. have hammered out a major trade deal worth hundreds of billions, combining tariff relief for Seoul with massive investment commitments toward the U.S. economy. The timing—just before Trump’s meeting with Xi—adds strategic heft as Washington seeks to recalibrate its global trade posture.