Korea may be able to reduce tariffs to 15 to 18% with the right deal: former US trade official

Korea Herald

3 days ago

'Trump has put trade in the middle of determining and evaluating what a relationship is with every country'
Korea may face US tariffs of between 15 to 18 percent as the country scrambles to cut a better deal with Washington, a former US trade official said Friday
'I see countries such as Korea, I see Japan in the same bucket. ... as being able to get out from under the highest tariffs that have been threatened but (only) with some kind of deal,' Michael Beeman, former assistant US trade representative for Japan, Korea and APEC, said in a video podcast released by the Korea Economic Institute of Korea.
Beeman, whose US trade official tenure lasted January 2017-2023 during Trump's first term, believes that Korea may be able to reduce the tariffs to the "15 to 18 percent (range)" if negotiations lead to a deal that the Oval Office deems successful.
"That is still a major tariff on a lot of exports … So some of the auto, steel and other tariffs, I think Korea may be able to moderate some of those terms, but there's still going to be really large tariffs.'
US President Donald Trump sent a publicly disclosed letter to Korean President Lee Jae Myung on July 7, stating that the US will impose "only" 25 percent tariffs on all Korean products imported into the US starting Aug. 1. He warned that the US would increase the tariff rate further if Korea decides to raise tariffs on US imports.
Asked about the possible threat of increased tariffs, Beeman acknowledged 'the style of (President Trump) and the style of the Oval Office ... it is kind of chaotic compared to most US administrations," adding he believes "that chaos and unpredictability is part of the plan.'
'That is part of the style that the (Trump administration) dabbled with a little bit during the first term that has come roaring back, and it's all about keeping the business environment uncertain.'
Since the presidential election in early June, the Lee administration has made an all-out push in tariff negotiations with the US, holding a series of high-level and working-level meetings with American counterparts over the past month.
Beeman cited Korea's auto sector — which has seen a steady decline in US-bound exports since Trump's 25 percent tariff on all vehicle imports took effect on April 1 — as an example of how countries might be able to negotiate or moderate certain aspects of US tariffs and gain export advantages.
'Korea might get some consideration based on the number of cars the US is shipping to Korea, which is ... not much compared to what goes the other direction, in exchange for lower tariffs for that amount of exports and not for the full amount of Korea's exports,' he said.
'(President Trump) has put trade in the middle of determining and evaluating what a relationship is with every country, ... it's seen as a package in many ways. So I think it really will depend on what this package looks like and the degree to which ... Korea feels it will resonate with the president as a country that's willing to stand shoulder-to-shoulder with the US.'