President Donald Trump announced Wednesday that he and South Korean President Lee Jae-myung have “pretty much finalized” a major bilateral trade agreement, setting the stage for a new era of economic and strategic partnership between the two nations.
Speaking during a meeting at the Asia-Pacific Economic Cooperation (APEC) summit in Gyeongju, South Korea, Trump confirmed that the deal’s key components are agreed upon. “We made our deal,” he told reporters. “We came to a conclusion on a lot of very important items.”
To commemorate the moment, President Lee awarded Trump South Korea’s highest civilian honor — the Grand Order of Mugunghwa — making him the first American president to receive it. Lee also gifted Trump a replica royal crown, a symbolic nod to the strong relationship and a gesture that rankled Trump’s critics back home.
The agreement includes a sweeping $350 billion South Korean investment in the United States. The funds will be divided between a $200 billion general investment package, disbursed over a decade, and a more urgent $150 billion initiative focused on revitalizing the American shipbuilding industry.
Trump has made restoring U.S. shipbuilding capacity a top economic priority, especially in light of Chinese dominance and recent sanctions Beijing imposed on South Korean firm Hanwha Ocean for supporting U.S. ports.
Tariff reductions are also a key feature of the deal. The reciprocal tariff rate between the two nations will be lowered from 25% to 15%. South Korea had been lobbying for a reduction in U.S. auto tariffs, arguing they were higher than those faced by Japanese and European competitors.
Additional trade adjustments include granting most-favored nation status to pharmaceuticals and lumber, exemptions on certain airplane parts and natural resources, and equalized treatment for South Korean semiconductors in line with Taiwanese imports.
Kim Yong-beom, an aide to President Lee, emphasized that the deal will reduce uncertainty and create a favorable climate for Korean firms entering the U.S. market. A formal fact sheet outlining the full agreement is expected to be released in the coming days.
To prevent sudden policy reversals, the deal will include a framework based on “commercial rationality,” ensuring that neither side imposes unrealistic investment expectations on the other.
