President of the United States Donald Trump announced an increase in tariffs on goods imported from South Korea to 25%. This decision came as a result of his accusations against Seoul for "failing to meet" the terms of a previously reached trade agreement, as reported by the BBC.
In his social media message, Trump stated that tariffs on certain South Korean goods, including cars, lumber, and pharmaceuticals, will rise from 15%. He also noted that "all other goods subject to reciprocal tariffs" will be affected by this increase.
The US President expressed dissatisfaction with the slow approval process of the deal by South Korean lawmakers, while he claims that the US has already taken steps to reduce its tariffs in accordance with the agreement.
Seoul, for its part, stated that it had not received official notification of the new tariff increase and is demanding immediate negotiations with Washington on this issue.
South Korean Minister of Industry Kim Jong Kwan, while in Canada, intends to travel to Washington as soon as possible for negotiations with US Secretary of Commerce Howard Lutnick.
Against this backdrop, shares of several South Korean companies have fallen in price: Hyundai shares dropped by 2.5%, and there is also a decline in the stock prices of pharmaceutical and logging companies.
It is worth recalling that in October of last year, Seoul and Washington reached an agreement under which South Korea committed to invest $350 billion (£256 billion) in the US economy, part of which will be directed to shipbuilding.
In the following month, both countries agreed that the US would reduce tariffs on certain goods as soon as South Korea began the process of approving the agreement.
The document was submitted for consideration to the National Assembly of South Korea on November 26, and its adoption is expected to take place in February.
It should be noted that the tariffs will be paid by American companies importing products from South Korea and will amount to 25% on the relevant goods.
During his second term as president, Trump frequently used tariffs as a tool of foreign economic policy.
Last Saturday, he threatened Canada with a 100% tariff if it signed a trade agreement with China.
On Monday, Chinese officials assured that the agreement with Canada on "strategic partnership" is not directed against other countries.
Canadian Prime Minister Mark Carney stated that his country does not plan to enter into a free trade agreement with China and "never" considered such an option.
He also noted that Canadian authorities clearly conveyed their position to their American counterparts.
Earlier, Trump also stated that he intends to impose import tariffs on eight countries, including the United Kingdom, which oppose American plans to seize Greenland, an autonomous territory of Denmark, which is a NATO member.
Later, he backed off the threat of tariffs regarding Greenland, citing progress in negotiations for a future agreement concerning the island; however, this incident worsened relations between the US and Denmark and other NATO allies.
