Trump threatens South Korea with tariffs, accusing Seoul of violating agreement

WASHINGTON — President Donald Trump has announced plans to increase tariffs on South Korean imports from 15% to 25%, targeting key sectors including automobiles, wood, and pharmaceuticals.

In a social media post, Trump accused South Korea's legislature of failing to enact a "Historic Trade Agreement" previously reached between the two nations.

The U.S. administration has not yet issued an official notification regarding the move. However, the announcement caused shares of South Korean automakers to drop briefly.

The South Korean government said it received no prior notice of the plan and is moving quickly to manage the situation. Trade Minister Kim Jung-kwan is traveling to Washington for negotiations.

Seoul’s ruling party stated it would work with the opposition to fast-track the passage of bills necessary to implement the agreement.

The latest threat would reverse a tariff reduction established last year. Under that deal, Seoul pledged to invest $350 billion in the United States in exchange for Washington lowering tariffs on South Korean vehicles from 25% to 15%.

Donald Trump’s latest maneuvers offer a masterclass in his signature brand of transactional diplomacy, where tariffs serve as the primary instrument of geopolitical leverage. The threat directed at South Korea—a linchpin security ally—underscores a recurring theme of his foreign policy: no partner is exempt from such pressure, a reality already made clear by recent warnings issued to Canada and Europe.

At the heart of the friction lies a widening gulf between high-level executive agreements and the complexities of domestic legislative frameworks. While the Trump administration appears to view verbal commitments as immediate mandates, Seoul remains tethered to the realities of its own political and legal processes. The South Korean presidency’s previous characterization of the understanding as a mere "memorandum" highlights a fundamental disconnect in interpretation that has now reached a breaking point.

The resulting market instability was immediate, evidenced by the sharp sell-off in South Korean automotive stocks. For the private sector, long-term strategic planning has become increasingly fraught as trade policy pivots on the whims of social media pronouncements. This escalation also forces President Lee Jae Myung into a precarious political balancing act: he must find a way to de-escalate tensions with Washington without appearing to bypass constitutional norms or capitulate to external coercion.

For Washington’s global trading partners, the takeaway is unambiguous: under a Trump administration, a deal is never truly finalized until it is executed to the total satisfaction of the White House.

While this development may not have a direct or immediate impact on Vietnamese-American small businesses like nail salons or phở restaurants, the administration’s repeated use of tariffs as a bargaining chip creates an atmosphere of general economic uncertainty. This instability could indirectly weaken consumer confidence and create challenges for small business owners who rely on import-heavy supply chains to stock their shelves and serve their communities.