The United States Secretary of Commerce, Howard Lutnick, announced on Monday, December 1st, that in light of South Korea proposing a bill aimed at fulfilling its investment commitments to the United States, the U.S. will reduce import tariffs on Korean automobiles to 15% in accordance with the trade agreement reached between the two countries. This tariff reduction will be retroactively effective as of November 1st.
In a post on the social media platform X on Monday, Lutnick commented on the implementation of the historic U.S.-Korea trade agreement, stating that South Korea has formally initiated legislation in its parliament to implement strategic investments in the United States. He mentioned that this crucial step ensures that American industries and workers will fully benefit from the trade agreement reached with South Korea under President Trump.
“As a response, the U.S. will lower certain tariffs according to the agreement, including reducing automobile tariffs to 15%, retroactively effective from November 1st,” Lutnick said. “We will also eliminate tariffs on aircraft parts, ‘un-stack’ Korea’s equivalent tariffs, aligning them with Japan and the EU.”
Lutnick further expressed gratitude for South Korea’s investment commitments to the United States, stating that it “enhances our economic partnership, domestic employment, and industries. We appreciate the deep trust between our two countries and look forward to continued close cooperation with Seoul to build a stronger and more prosperous future for both nations.”
Last month, the United States and South Korea announced the conclusion of a trade agreement. South Korea pledged to invest $350 billion in the United States in exchange for the U.S. reducing tariffs in areas such as automobiles, auto parts, and timber from 25% to 15%.
South Korea’s $350 billion investment in the U.S. includes a $150 billion investment in the American shipbuilding industry. Additionally, based on the U.S.-Korea Investment Memorandum of Understanding (MOU) signed, South Korea will make a strategic investment of $200 billion in the United States. The U.S. has formally agreed to support South Korea in building nuclear-powered submarines, which is crucial for South Korea to address regional threats it faces.