[Text/Observer Network Wang Kaiwen] The Trump administration of the United States regards tariffs as a bargaining chip to push for trade negotiations, attempting to force other countries to make concessions. South Korea has been listed by the United States as one of its "priority targets" for negotiation. South Korean Prime Minister and Acting President Han Duck-soo also synchronized with the U.S. rhythm, stating that he would promote negotiations with the U.S., hoping to seek a "win-win" solution.
U.S. Treasury Secretary Scott Beason said on April 14 that the U.S. will start tariff negotiations with South Korea next week. South Korean public opinion is concerned that holding such negotiations at this time is too hasty, fearing it might fall into a trap set by the U.S., which could harm South Korea's national interests.
With Yoon Suk-yeol being impeached and stepping down, South Korea will hold early presidential elections in June this year. At present, political circles in South Korea are debating over the negotiations with the U.S. South Korean media pointed out that if the tariff negotiations yield results, it may benefit the ruling People Power Party’s election prospects. However, the main opposition Democratic Party opposes hastily conducting tariff negotiations.
"The South Korean government is very proactive."
"The U.S. sets up negotiation traps, and Han Duck-soo rushes into them." The Hankyoreh Daily Chinese website published an article with this title on April 16, questioning whether South Korea would repeat the mistakes of Japan's "Plaza Accord" 40 years ago if it hastily reaches an agreement with the U.S.
The report stated that after the Trump administration designated South Korea as a priority negotiating country, it hastened efforts to reach an agreement. Beason told Bloomberg last week, "We negotiated with Vietnam last week, Wednesday with Japan, and next week we will discuss with South Korea; the process will be very fast." He also mentioned that the sooner a country acts, the greater the benefits it gains, and the first party to reach an agreement often gets the best terms.
South Korean Acting President Han Duck-soo - Yonhap News
On April 15, the Korea Gas Corporation held a video conference with the Alaska state government regarding the liquefied natural gas (LNG) project. Kim Nam-ho, second deputy minister of the Ministry of Trade, Industry and Energy, also mentioned this project in a speech, stating that South Korea and the U.S. are having pragmatic discussions on this project. If sufficient benefits can be obtained in the auto tariff issue, then this LNG project can be used as a concession condition in the negotiations.
The report pointed out that these signs indicate that the South Korean government is actively responding to the U.S.' intentions and proactively participating in the negotiations. However, rushing into negotiations following the U.S.' rhythm may lead to hasty compromises in the tariff game, ultimately harming the interests of South Korea and South Korean enterprises.
"The key lies in whether the U.S.' tariff policy has been finally determined. If the goalposts are not yet clear, how can one talk about shooting direction?" asked Kim Yang-hee, professor of economics at Daegu University. She believed that rashly advancing negotiations under Trump's unpredictable policies might result in strategic errors. At this stage, the focus should first be on understanding what the U.S. intends to do and truly wants.
What does the U.S. have in mind?
Some voices pointed out that South Korea is currently in a short-term "acting regime," with the president yet to be elected. The current government should not rashly decide matters that may affect long-term national interests and require significant political responsibility.
In terms of the Alaska LNG development project, the total investment is estimated to be $44 billion. The construction of a 1,300-kilometer pipeline and export terminal will take more than five years. Even if the project starts immediately, natural gas supply will only occur during the next-next administration, and its profitability depends on the energy market conditions at that time. During Trump's first term, this project was also promoted but was shelved due to no one willing to take over.
However, the South Korean government has now listed the LNG project as an important matter in the negotiations with the U.S.
According to the Chosun Ilbo Chinese website, Han Duck-soo said on April 14: "South Korea and the U.S. have decided to strengthen cooperation in three major areas: shipbuilding, liquefied natural gas, and improving and restoring trade balance, creating a friendly momentum for continuous discussions between the two countries."
In response to the controversy surrounding the Alaska project, Choi Sang-mok, South Korea's vice prime minister responsible for economic affairs, stated on April 15 at a parliamentary inquiry meeting: "This is not the time to commit to any matters or make decisions detrimental to national interests."
According to a Reuters report on April 14, Trump said that he discussed South Korea paying "important" U.S. military protection fees during his call with Han Duck-soo last week. This indicates that the U.S. wants to negotiate not only tariffs and trade but also defense costs, which may become part of a broader agreement.
Kim Hong-gyun, first vice minister of the South Korean Ministry of Foreign Affairs, said to the South Korean parliament on April 14 that the Trump administration has not yet proposed negotiating defense costs for U.S. troops stationed in South Korea. However, South Korea is preparing for various scenarios.
The Hankyoreh Daily also questioned how much actual benefit South Korea could gain from trade negotiations with the U.S.
The U.S. imposes an equal tariff rate of 25% on South Korea. A research report by the Korea Institute for International Economic Policy, a government-affiliated think tank, showed that out of $131.5 billion worth of goods South Korea exported to the U.S. last year, 42% ($55.6 billion) were included in the "equal tariff." Semiconductors, automobiles, steel, electronics, and other major South Korean exports mostly belong to the "item-specific tariff" category, which cannot be reduced through this round of negotiations with the U.S.
Even within the 25% "equal tariff," 10% is the basic tariff rate unrelated to negotiations, making the actual benefits obtainable through negotiations even more limited.
"Will South Korea repeat Japan's mistakes 40 years ago?" The Hankyoreh Daily questioned, pointing out that in 1985, under U.S. pressure, Japan signed the "Plaza Accord," which eventually led to two decades of stagnation in its economy. This historical lesson remains fresh in memory.
The report mentioned that Beason recently stated in Argentina that "we ask the other side to bring us their best proposal, and then decide the negotiation direction based on the content." In other words, the U.S. did not clearly promise any returns but required the other side to put forward "high-priced chips" first. If the South Korean government urgently finalizes the agreement, it risks falling step by step into the negotiation trap set by the U.S.
U.S. Treasury Secretary Scott Beason - Video Screenshot
Are the South Korean-U.S. negotiations related to the South Korean election?
According to KBS News Network reports, the G20 Finance Ministers' Meeting will be held next week in Washington, D.C. This meeting is a consultation mechanism discussing multilateral financial cooperation issues such as interest rates and exchange rates. Choi Sang-mok will attend the meeting. The report mentioned that the U.S. requested the discussion of trade issues at this meeting.
South Korea's Ministry of Finance confirmed on April 16 that Choi Sang-mok will meet with Beason next week to discuss trade issues including the U.S.' new import tariffs.
KBS noted that the U.S. has designated South Korea, Japan, the UK, Australia, and India as priority negotiating partners, but these countries "mutually observe each other" and do not want to accelerate the negotiations.
Ryo Akazawa, Japan's minister for economic revitalization, has arrived in the U.S. and plans to meet with the U.S. side in Washington from April 16 to 18. Prime Minister Shinzo Abe recently stated that Japan will not rush to reach an agreement and does not intend to make major concessions.
According to "Chosun Biz," an economic industry media under the Chosun Ilbo, as the South Korean government prepares to start tariff negotiations with the U.S., intense debates over the negotiation topics and pace have erupted in South Korean political circles.
Politicians in South Korea revealed that the Democratic Party strongly opposed the government strengthening tariff negotiations and stated that it could not rush into tariff negotiations with the U.S. Kim Min-sik, a Democratic Party member of parliament, said: "Negotiations and agreements are the responsibilities and powers of the newly elected government with electoral legitimacy and negotiation rights."
The 90-day tariff deferral period imposed by the Trump administration will expire on July 8, while South Korea will hold early presidential elections on June 3.
The Democratic Party requested that the South Korean government and all parties discuss under the principle of prioritizing national interests through setting up a special parliamentary trade committee, involving discussions among civilians, public sectors, and the government, and sending a bipartisan delegation to the U.S. to jointly deliberate the negotiation direction.
On the other hand, the People Power Party criticized the Democratic Party for turning the tariff war into a political topic. They stated that tariffs directly impact the national industry, employment, and livelihood, and the government must quickly conduct negotiations.
The report analyzed that the People Power Party believes that if a clear outcome can be achieved in the tariff negotiations with the U.S. now, it may help the conservative camp's election prospects.
Previously reported by the Asian Daily, Han Duck-soo may run for president as an independent candidate and integrate with conservative camp candidates to form a "anti-Lee Jae-myung" united front.
Currently, People Power Party candidates trail Lee Jae-myung significantly in various polls. The outside world generally pays attention to whether Han Duck-soo will join the race in the coming weeks. On April 15, the People Power Party announced that 11 people have registered for the 21st presidential primary election. Han Duck-soo will not participate in the internal competition.
In 2007, during his tenure as prime minister in the Roh Moo-hyun administration, Han Duck-soo led the signing of the initial version of the Korea-U.S. Free Trade Agreement. From 2009 to 2012, as South Korean ambassador to the U.S., he successfully facilitated the formal implementation of the agreement.
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Original source: https://www.toutiao.com/article/7494200557368803840/
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