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South Korea’s president has expressed pessimism that “very troublesome” commerce talks with the US will be concluded earlier than Washington’s self-imposed deadline subsequent week to avert steep tariffs, noting that “the 2 sides are usually not actually clear on what they need”.
South Korea was “doing its utmost” to discover a decision to negotiations triggered by US President Donald Trump’s risk to impose a 25 per cent “reciprocal” tariff on Asia’s fourth-largest economic system, Lee Jae Myung instructed reporters on Thursday.
However he performed down expectations that an settlement could be reached earlier than July 9, when paused US tariffs on a number of nations have been resulting from come into pressure.
“We’re actively figuring out and creating many agenda objects throughout varied areas,” mentioned Lee. “[But] at this level, it’s troublesome to say with certainty whether or not they are often concluded” by the deadline.
Lee’s feedback got here after Trump threatened this week to extend levies on Japan, casting doubt that his administration would attain a cope with Tokyo.
Trump’s risk to extend the “reciprocal” tariffs on Japan to 30 or 35 per cent from the unique stage of 24 per cent spooked South Korean policymakers, who have been hoping for an extension to the deadline.
Commerce talks have been delayed for months owing to the political turmoil in Seoul following the impeachment of Lee’s conservative predecessor Yoon Suk Yeol.
In line with a number of folks conversant in the talks between US and South Korean officers, Seoul has communicated a willingness to deal with its document $55bn commerce surplus with the US by rising purchases of American fuel and defence tools and by eradicating non-tariff boundaries publicly criticised by US commerce consultant Jamieson Greer.
The 2 nations are additionally discussing South Korean investments in US shipyards to assist revive American shipbuilding, together with for the US Navy, in addition to a doable Korean dedication to purchase fuel from a possible new undertaking being promoted by the Trump administration in Alaska.
However one of many folks mentioned the talks over shipbuilding co-operation had been difficult by protectionist US laws stopping overseas involvement within the trade. Korean firms additionally stay hesitant about committing to the Alaska LNG undertaking, the viability of which has been questioned by power trade specialists, in keeping with a number of folks conversant in the discussions.
The US accounted for 18 per cent of South Korean exports final yr, in keeping with OECD figures, with main exports together with automobiles and auto components, equipment and intermediate items to provide Korean firms constructing automobile, battery and chip manufacturing services within the US.
Not like Japan, South Korea has a complete free commerce settlement with the US beneath which tariff charges between the 2 nations needs to be in impact zero.
As with Tokyo, South Korea is pushing for the elimination of a 25 per cent US tariff on auto imports, which has driven a steep decline in Korean automobile exports to the US in latest months.
South Korean firms have additionally been hit by US tariffs imposed on metal and family home equipment.
Seoul can also be involved that sectoral tariffs being threatened by the US in opposition to chip and prescription drugs imports, following investigations which are anticipated to conclude later this yr, may result in the unravelling of any commerce settlement reached this month.
An individual conversant in the talks mentioned US negotiators had expressed frustration in latest days that their Korean counterparts have been “not being bold sufficient”.
However they added that the Koreans have been nonetheless confused about what the US aspect really desires. “All they know is that no matter it’s, the Individuals need extra.”
