90-Day Tariff Freeze: How Korea should weigh its trade approach

The country-specific U.S. tariffs are on hold for now but the baseline 10-percent tariff on all foreign-origin goods as well as the 25-percent tariff on cars and steel imports into the American market remain in place.

So what have been the ripple effects of these tariffs on South Korea thus far?

Our correspondent Lee Soo-jin takes a look.

This is just one of over 100 tariff-related inquiries the Korea Trade-Investment Promotion Agency now receives daily, a sharp jump from just 20 before U.S. President Donald Trump's tariffs.

But while the 90-day pause on reciprocal tariffs offers Korea temporary relief, existing duties remain a challenge.

The 10-percent baseline tariff that went into effect on April 5th remains in place, and the 25-percent duties on items like automobiles and steel are not covered by the 90-day grace period.

And starting May 3rd, a 25-percent tariff on auto parts will also go into effect.

"Auto parts suppliers are facing significant disruption. Some sub-parts required for manufacturing are still being imported from Korea. So even if vehicle assembly happens locally, the impact of increased tariffs on imported car parts is still unavoidable."

But as of now, markets are seeing a recovery.

A buy-side sidecar was triggered Thursday morning for the first time in over eight months, as the KOSPI 200 futures jumped more than 5 percent from the previous session, just days after a sell-side sidecar was activated on Monday, also for the first time in eight months.

A buy-side sidecar was also activated for the KOSDAQ during morning trade for the first time since August last year when the futures and the stock index each rose more than the 6 percent and 3 percent thresholds.

The market rebound extended through the day, with the KOSPI and the KOSDAQ indexes both closing up at around 6 percent.

And the 90-day pause provides Korea a chance to strengthen its trade strategy.

"With the United States not only trade and tariff but also shipbuilding, energy investment in Alaska gas pipe and defense cost-sharing is expected to be discussed comprehensively."

As one of the Trump administration's key energy priorities is fossil fuels, it has repeatedly urged Korea to join the Alaska LNG project.

In response, South Korea's Foreign Ministry issued a research tender on Thursday to explore ways to expand U.S. oil and LNG imports.

Shipbuilding, where Korea is a global leader, is also emerging as a key area of cooperation,

following Trump's executive order to rebuild the U.S. shipbuilding industry, citing national security and competition with China.

Lee Soo-jin, Arirang News.