The South Korean Parliament approved a $350 billion investment project on Thursday, linked to a trade deal signed last year with the United States. This investment comes after Washington initiated new investigations into alleged unfair trade practices in certain countries, including South Korea. As part of the deal made in October with Washington, Seoul committed to investing $350 billion in the U.S., with $150 billion in naval construction cooperation and the rest allocated to various strategic sectors like semiconductors.
In exchange, the agreement includes a reduction in South Korean export tariffs from 25% to 15%, as part of the tariffs imposed by President Donald Trump. However, in January, the U.S. threatened to raise the rate back to 25%, claiming that the South Korean Parliament was not respecting the agreement by not swiftly voting on the necessary bill for the investments. The bill was eventually adopted with the support of the ruling party and the main opposition party, the People Power Party (PPP), with a vote of 226 to 8.
President of South Korea, Lee Jae Myung, stated that with the approval of this special law, the institutional and legal foundations needed to implement the tariff agreement between South Korea and the U.S. are now in place. This vote came after Washington launched a series of investigations on Wednesday to document economic injuries suffered by the U.S., including South Korea, potentially leading to sanctions and new tariffs. The U.S. Supreme Court revoked the initial tariffs imposed by Trump in February, deeming his actions as exceeding his authority. However, Trump quickly reintroduced a new 10% surtax on Tuesday for a duration not exceeding 150 days.
