Seoul: South Korea is currently reviewing a new proposal from the United States regarding the US$350 billion investment package, as part of ongoing tariff negotiations between the two nations, Foreign Minister Cho Hyun stated on Monday. The discussions focus on how Seoul would finance this significant investment, which was initially agreed upon to reduce U.S. tariffs on South Korean products from 25 percent to 15 percent.
According to Yonhap News Agency, the U.S. administration, led by President Donald Trump, had earlier insisted that the investment package should be delivered “upfront.” However, South Korean officials have emphasized that the investment was meant for funding projects rather than a direct cash payment, advocating for safeguards such as a currency swap to be included in the deal.
During a parliamentary session, Cho mentioned that the U.S. has presented an alternative proposal in response to South Korea’s recent suggestions. He expressed concerns about the potential economic disruption if the entire $350 billion is directed into U.S. investments, particularly regarding the foreign exchange market. Cho highlighted the ongoing review of the new U.S. proposal, noting that South Korea cannot provide the investment in the form of direct cash.
Furthermore, Cho affirmed South Korea’s commitment to strengthening its alliance with Washington, signaling an intention to enhance its defense posture. The U.S. has pledged to reinforce its security commitment to South Korea and to boost bilateral cooperation in providing extended deterrence.
The Trump administration aims to “modernize” the longstanding alliance with Seoul, possibly to ensure that U.S. forces in South Korea can be utilized for operations beyond the Korean Peninsula, addressing broader regional challenges such as those posed by China.
Looking ahead to the upcoming Asia-Pacific Economic Cooperation (APEC) summit in South Korea, Cho noted that a potential visit by President Trump would symbolize reciprocal diplomacy following South Korean President Lee Jae Myung’s visit to Washington in August. Additionally, the summit presents an opportunity to revitalize leadership-level exchanges between South Korea and China, with Chinese President Xi Jinping expected to attend.