South Korea’s Yeo Han-koo Heads to Washington for Key Tariff Talks

- South Korea’s Trade Minister Yeo Han-koo to visit Washington. - Talks aim to negotiate US tariff reductions before July 8 deadline. On June 21, 2025, Reuters reported that South Korea’s Trade Minister Yeo Han-koo will visit Washington from June 22 to 27 for a third round of trade talks with US officials. These meetings primarily aim to negotiate a reduction in US tariffs, which are currently paused, before the crucial July 8 deadline. Yeo Han-koo plans to discuss tariff reduction and broader economic cooperation with US Trade Representative Jamieson Greer. These talks are urgent as they aim to address economic challenges, particularly since South Korea’s economy contracted by 0.1% in the first quarter of 2025. In response to this economic downturn, the Bank of Korea cut its policy interest rate to 2.5% on May 29, 2025. This reduction marked the fourth rate cut in the last six meetings and brought the rate to its lowest level since August 2022. Political situations in both countries will likely complicate discussions, as both nations have new administrations that are not yet fully staffed. Economics professor Heo Yoon from Sogang University suggested that, given these conditions, the talks will likely focus on manageable areas and avoid major issues like defense cost-sharing and exchange rates. The current US tariffs include a 10% blanket tariff and a separate 25% country-specific duty imposed by the Trump administration. If the parties do not reach an agreement by July 8, the US will reinstate these tariffs. Furthermore, political chaos caused by former President Yoon Suk Yeol's attempt to declare martial law in December 2024 impacted investor confidence and now influences these trade negotiations. The Bank of Korea has indicated that it expects economic growth to decline significantly, even while inflation remains stable. Meanwhile, South Korea’s trade ministry acknowledged that time constraints make reaching a comprehensive agreement covering tariff relief and broader economic cooperation difficult. On June 21, NewKerala.com, citing Yonhap news agency, reported that the Lee Jae Myung government appointed Yeo Han-koo as trade minister on June 10, 2025. The same report stated that Yeo Han-koo will focus the talks on tariffs, non-tariff measures, economic security, investment cooperation, and currency policies. Additionally, the US has raised concerns about South Korea’s trade surplus and various non-tariff barriers.