- US tariffs impact Korean exports, especially automotive sector.
- Semiconductor exports see record high despite overall decline.
- Ongoing trade tensions may influence future growth opportunities.
Impact of US Tariffs on South Korean Exports
South Korea witnessed a notable decline in exports, primarily due to US-imposed tariffs under the Trump administration. In May 2025, export numbers dropped to $57.27 billion, marking a decrease of 1.3% year-on-year, the first decline since January.
The Trump administration’s tariff decision impacted multiple sectors, with the automotive industry facing a 25% tariff on imported cars and parts. In response, South Korea, through its Ministry of Trade, aims to engage with the US to mitigate these effects.
Immediate effects were felt in the automotive and electronics industries. Car exports decreased by 4.4%, while semiconductor exports rose 21.2% to reach a record high of $13.8 billion in May. The overall economic impact underscores the interconnectivity of global markets.
Bilateral Trade Relations Under Strain
The financial implications extend beyond individual sectors, affecting bilateral trade relations and global market dynamics. The tariffs on Korean exports are part of broader trade policies that may reshape existing economic patterns and strategies.
Economically, the fluctuations offer insights into market dynamics, with semiconductor growth possibly driven by increased global demand. Future trade policies and negotiations remain crucial in shaping economic trajectories and maintaining balance in international trade relations.
Ahn, Official, South Korean Ministry of Trade, Industry and Energy, commented, “To minimize the damage to our export companies and maximize national interest, the government will clearly communicate our position on U.S. tariff measures to the Trump administration and work toward mutually beneficial solutions.”
