South Korea's trade minister could ask for an extension of the tariff freeze during US-South Korea talks
South Korea's Trade minister Yeo Han Koo said that he may request an extension to the U.S. Tariffs Freeze that expires in a few days, when he travels to Washington to meet with U.S. officials.
Yeo, South Korea's newly appointed trade envoy, will fly to the U.S. this Friday. He plans to meet with U.S. Representative Jamieson Greer, and other senior officials, on Saturday. This is just before the deadline of July 9, when U.S. Tariffs may increase dramatically.
Donald Trump, the president of the United States, said that his administration will begin sending letters to countries on Friday specifying which tariff rates they must pay on imports from other countries.
Yeo stressed that the substance of the negotiations was more important than the deadline. He said he would urge the U.S. take their time and speed up the talks in order to achieve a "win-win deal".
South Korea is seeking exemptions from Trump’s punishing tariffs for imports of steel and automobiles, as well as 25% “reciprocal” levy against the Asian ally that has been paused in negotiations.
In late April, the U.S. and the government of Asia's 4th largest economy, which currently faces a 10% blanket tariff, reached an agreement to negotiate a deal that would reduce tariffs before the deadline of July.
Negotiations appear to have been hampered in recent months by the political uncertainty that followed the crisis of martial law in South Korea, with President Lee Jae Myung being elected as its new leader on 3 June.
On Thursday, President Lee stated that the talks between Seoul and Washington were "not easy", noting that both sides had a lack of clarity on their goals.
Washington demands better access to the agricultural and automotive sectors and improved market access as well as non-discriminatory treatments in the digital sector. Minister Yeo said at a Friday parliamentary hearing.
Yeo stated that the government would respond with flexibility, taking into consideration the level of U.S. demand and the domestic political security sensitivities.
Yeo said the United States also wanted to see more South Korean energy purchases from the United States and larger investments in South Korea by South Korean firms.
Yeo stated that although South Korea showed interest in a $44 Billion LNG project in Alaska the project's feasibility was not yet clear. The U.S. will only provide further information later this year.
At the Yeo hearing, both the ruling and the opposition parties urged the government to carefully assess whether or not to invest in Alaska.
"Once we're in the wrong spot, it is difficult to get out," said Lee Chul Gyu, a member of the People Power Party.
South Korea's attempts to reach a deal on trade come at a time when Trump announced that the United States and Vietnam had agreed to a 20% tariff on imports from Vietnam. This is down from a 46% tariff rate Trump initially threatened.
Yeo stated that South Korean firms who use Southeast Asia as a base for manufacturing would be affected.
South Korean companies like Samsung Electronics are investing billions in expanding their operations to Vietnam. Reporting by Hyunjoo Ji and Ju-min Park Editing and Michael Perry by Ed Davies
(source: Reuters)
