Korea braces for impact from U.S. tariffs as companies face different fates

Right and with regard to the potential risks from Mr. Trump's tariff campaign my colleague Kim Do-yeon takes a look at their broader implications on Korean export items ranging from cars to chips and even ramyeon.

25 percent — that's the tariff rate set to take effect August 1st on South Korean imports into the U.S as of now.

But Korea's exports largely consist of goods like automobiles, which already face a 25 percent tariff regardless of origin.

So, how does this stack up against competitors like Japan and Germany?

According to the Korea International Trade Association, over 30 percent of exports to the U.S. from both Korea and Japan are cars.

Experts say a uniform tariff means little changes in the playing field between these countries.

The bigger concern? Mexico.

"Mexico benefits from lower rates under the USMCA when it comes to cars and auto parts, giving it a price edge over Korea."

And with similar tariffs set to hit other Korean exports like semiconductors and pharmaceuticals, exchange rates become critical.

"If the Korean won weakens against the dollar by 10 percent, it effectively offsets a 10 percent tariff. That means U.S. prices don't rise, and their trade deficit doesn't shrink."

As for reciprocal tariffs, some Korean strongholds like K-beauty products and ramyeon are also in the crosshairs.

K-beauty tops U.S. imports by country, pushing Korean firms to consider local production.

"Companies like Amore and LG don't have factories in the U.S. yet, so they're exploring M&As to quickly establish local plants."

Meanwhile, ramyeon tells a different story. Nongshim's Shin Ramyeon is made in the U.S., dodging tariffs. But Samyang's Buldak, still fully exported from Korea, will likely see higher prices.

Kim Do-yeon, Arirang News.