U.S. confirms South Korea tariff rate stays at level set in bilateral deal

Industry Minister Kim Jung-kwan said Thursday that U.S. officials reaffirmed South Korea will not face higher tariffs than agreed under last year's bilateral trade deal. Kim made the statement after holding a video call Wednesday with U.S. Commerce Secretary Howard Lutnick, shortly after the office of the U.S. Trade Representative proposed new tariffs tied to forced-labor enforcement under Section 301 of the 1974 Trade Act.

South Korea, China and Japan are among 54 economies that could face the proposed 12.5 percent tariff.

Background on the bilateral tariff agreement Under the deal finalized late last year, the U.S. agreed to lower its reciprocal tariffs on South Korea to 15 percent from 25 percent in exchange for Seoul's US$350 billion investment pledge. Kim wrote that the two sides reviewed the implementation status of the agreement and reaffirmed their commitment to upholding it.

"In particular, the U.S. side once again confirmed that no tariffs beyond the level agreed under last year's tariff deal will be imposed on South Korea," Kim added.

Additional statements from South Korean officials Trade Minister Yeo Han-koo also urged the U.S. to resolve pending trade issues within the boundaries of the Seoul-Washington deal. Yeo made the call during a meeting with USTR Jamieson Greer on the sidelines of the OECD Ministerial Council Meeting in Paris on Wednesday.

"I made it clear that not only the outcomes of the latest Section 301 probe but also other future bilateral trade issues should be addressed within the framework of the Korea-U.S. tariff agreement rather than through the imposition of new tariffs," Yeo said in a press release.

South Korea is also subject to a separate USTR investigation into what it calls "unfair" trade practices related to "structural" excess capacity and production, along with China, Japan and 13 other economies.