South Korea Braces for Impact as U.S. Tariffs Loom Large

The government is committed to successfully concluding tariff negotiations with the United States in order to minimize risks for export companies, the first vice industry minister said on Tuesday.

First Vice Industry Minister Moon Shin-hak stated during a meeting to review export trends that South Korean export companies are facing increased uncertainties as the U.S. prepares to implement reciprocal tariffs on August 1.

“In the remaining period, the government will do everything possible to ensure a smooth conclusion to the tariff negotiations with the U.S. while maximizing our national interests,” he added, referring to the August 1 deadline when the U.S. will begin imposing 25 percent reciprocal tariffs on South Korean products.

Data from the Korea Customs Service showed that South Korea’s exports fell by 2.2 percent year-on-year to $36.1 billion in the first 20 days of this month.

Outbound shipments to the U.S. dropped by 2.1 percent compared to last year, totaling $6.42 billion, largely due to the sweeping tariff measures implemented under President Donald Trump’s administration.

When broken down by category, steel shipments declined by 9.7 percent to $2.39 billion, likely impacted by the administration’s 50 percent tariffs on all steel imports.

Exports of petroleum and petrochemical products decreased by 17.5 percent and 13.9 percent to $2.52 billion and $2.36 billion, respectively, amid a global slump in oil prices.

On a more positive note, semiconductor exports grew by 16.5 percent year-on-year to $7.89 billion, while automobile exports increased by 3.9 percent to $3.63 billion.

Notably, outbound shipments of ships soared by an impressive 172.2 percent to $1.44 billion. (Yonhap)