S. Korea, U.S. seek to reach deal on removing tariffs, before tariff pause ends in July

Thank you for joining us. I'm Yoon Jung-min.

During their first "two-plus-two" trading meeting, South Korea and the U.S. have explored what would be available when it comes to removing new U.S. tariffs.

They have agreed upon a "July package" deal, with no mention of the allies' defense-cost sharing, when in fact U.S. President Trump signaled that the issue will be separated from tariff negotiations.

Bae Eun-ji starts us off.

South Korea and the United States have agreed to produce a package of deals to remove new U.S. tariffs before the July 8 deadline, when the 90-day pause on reciprocal tariffs is lifted.

This was discussed by South Korea's Deputy Prime Minister Choi Sang-mok and trade minister Ahn Duk-geun, alongside U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer during a high-level meeting in Washington on Thursday local time.

Seoul's trade ministry said in a statement that it requested exemptions from reciprocal tariffs and offered cooperation on shipbuilding and energy.

Following the meeting, finance minister Choi said the two sides agreed to aim for a deal by early July, and explained they will hold further discussions on four key areas of mutual interest: tariffs and non-tariff measures, economic security, investment cooperation, and currency policy.

"We focused particularly on the automobile sector, which faces the greatest negative impact."

Choi also said they asked for understanding from the U.S., as the negotiation process could be affected by Korea's political schedule and the upcoming presidential election.

He added that the two sides agreed to discuss this in detail when Greer visits South Korea to take part in the APEC trade ministers' meeting, scheduled to take place for two days starting May 15th.

Unlike trade talks between the U.S. and Japan, Thursday's meeting between Seoul and Washington did not include a discussion on the issue of sharing the cost of American troops in Korea.

In fact, Trump said in a White House press briefing on Thursday that the military will not be subject to any deals, signaling that the issue of U.S. troop costs will be discussed separately, apart from tariff negotiations --in what pundits in Seoul believe the U.S. could be taking a "two-track approach."

Meanwhile, Bessent also told reporters that the two countries had a "very successful" meeting, without disclosing further details on the talks.

"We may be moving faster than I thought, and we will be talking technical terms as early as next week, as we reach an agreement on understanding as soon as next weekend. So South Koreans came early, they came with their A-game, and we will see if they follow through on that."

South Korea, which faces 25% U.S. reciprocal tariffs, plans to leverage its shipbuilding capabilities in upcoming tariff negotiations.

Trade minister Ahn told parliament earlier that the Trump administration has expressed great interest in cooperation in shipbuilding, and said this will become an important negotiating card for Korea.

"U.S. is in urgent need of support in the shipbuilding sector as you mentioned, while Korea possesses world-most advanced shipbuilding capacity. Moving forward, if Korea and U.S. expand cooperation in shipbuilding and other technology sectors, it could serve as a channel to broaden discussion into other areas, leading to favorable negotiations."

Eyes are now on whether the two countries will be able to reach a fruitful deal that will exempt South Korea from higher levies.

Bae Eun-ji, Arirang News.