U.S.-South Korea Trade Deal Cuts Tariffs to 15% With $350B Investment

The U.S. and South Korea have finalized a major trade agreement under Donald Trump, featuring a $350 billion investment from South Korea into the U.S. economy and a 15% tariff on Korean exports to the United States. This deal, described by Trump as “full and complete,” represents a significant shift from the previously imposed 25% tariffs on South Korean imports [1]. The agreement also includes a $100 billion purchase of American energy products, boosting U.S. energy exports [2].

Under the terms, South Korea will not face tariffs on its imports into the country, while U.S. goods exported to South Korea will be subject to a 15% tariff. Trump emphasized that the U.S. would benefit from the arrangement, stating that “America will not be charged a tariff” [3]. The investment projects are to be selected by the U.S. side, according to sources close to the agreement [4].

South Korea’s presidential office expressed disappointment over the 15% tariff on car exports, a key sector for its economy. Despite these concerns, the country agreed to the terms, which also include substantial investment in U.S. infrastructure and energy sectors [5]. The reciprocal tariff reduction from 25% to 15% is seen as a major concession to encourage South Korea’s participation in the deal [6].

Analysts suggest the agreement could enhance U.S. economic growth, especially in energy and infrastructure, where South Korean investment could drive development. The $350 billion investment is expected to create jobs and stimulate domestic production, potentially reshaping the U.S. economic landscape [7]. However, the success of the deal will depend on the execution and the actual flow of capital into American projects.

The agreement has also sparked discussions among market observers. While some estimate the total potential value of the deal at over $450 billion when including energy and investment components, these projections remain speculative and unconfirmed by either party [8].

The U.S. and South Korea have navigated months of negotiations to reach this agreement, reflecting a mutual commitment to a balanced trade relationship. The outcome aligns with Trump’s broader economic strategy of securing favorable trade terms for the U.S., particularly in energy and infrastructure, through strategic investment and tariff adjustments.

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[1] South Korea to invest $350B in US under new Trump trade agreement, tariff rate lowered to 15%. (Fox) https://www.foxbusiness.com/politics/south-korea-invest-350b-us-under-new-trump-trade-agreement-tariff-rate-lowered-15

[2] Trump announces South Korea trade deal with $350B US investment. (New) https://nypost.com/2025/07/30/us-news/trump-announces-south-korea-trade-deal-with-350b-us-investment/

[3] US President Donald Trump announces 15% tariff on South Korean imports. (Investing.com) https://in.investing.com/news/stock-market-news/trump-secures-full-and-complete-trade-deal-with-south-korea-unlocking-350b-investment-framework-4936036

[4] U.S. cuts Korea's tariffs to 15% for $350B investment package. (Korea Joongang Daily) https://koreajoongangdaily.joins.com/news/2025-07-31/business/economy/US-cuts-Koreas-tariffs-at-15-for-350B-investment-package/2365504

[5] Korea expresses disappointment over 15% auto tariff. (ChosunBiz) https://biz.chosun.com/en/en-policy/2025/07/31/BFBMRGYNJJALPLQSCOZE3FLZCQ/

[6] US-S Korea Tariff Deal Nailed at 15%, w/ US$350B Investment. (AASTOCKS) https://www.aastocks.com/en/stocks/news/aafn-con/NOW.1457304/top-news/AAFN

[7] Trump Unveils $450B+ US–South Korea Deal: $350B Investments, $100B Energy. (Reddit) https://www.reddit.com/r/StockMarket/comments/1mdklzg/trump_unveils_450b_ussouth_korea_deal_350b/

[8] TRT World - X. (X) https://x.com/trtworld/status/1950723099910934854