South Korea proposes 'package deal' to avoid US tariffs

South Korea has proposed a "package deal" to Washington to avoid Donald Trump's steep tariffs, its finance minister said Friday, which US Treasury Secretary Scott Bessent said could bring a trade "understanding" by next week. 

The country is a major exporter to the United States, and giants such as Samsung Electronics and automaker Hyundai stand to take a hefty hit if the White House goes ahead with its threatened 25% "reciprocal" tariffs.

Finance Minister Choi Sang-mok and trade minister Ahn Duk-geun – who are in Washington – held talks with US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer, and "exchanged views on US tariff policies", the trade ministry said Friday.

South Korea proposed a "July Package" aimed at removing tariffs, which would be established before Trump's 90-day suspension on "reciprocal" tariffs is set to expire on July 8, the ministry said.

"(We) explained that the imposition of reciprocal and product-specific tariffs by the United States could negatively impact bilateral economic cooperation," Choi said at a press conference in Washington.

The South Korean government "conveyed its position that exemptions and waivers should be granted for tariffs imposed on Korean exports", added Choi.

He added that South Korea plans to hold additional talks with Greer, who will visit Seoul to attend the APEC Trade Ministers' Meeting scheduled for 15 and 16 May.

The two countries "reached a principled agreement on establishing a framework for future consultations", trade minister Anh said.

Separately, Bessent said the United States had a "very successful" meeting with the South Korean government and added that they may be "moving faster" than he thought.

"We will be talking technical terms as early as next week as we reach that agreement on understanding as soon as next week," Bessent told reporters.

"So the South Koreans came early… They came with their A-game, and we will see if they follow through on that," he added.

On Thursday, South Korea's central bank said that the country's economy unexpectedly contracted 0.1% in the first three months of this year due to tariff concerns and political chaos following a declaration of martial law.