U.S.-South Korea Tariff Talks Could Take Longer Due to Defense Costs -- Market Talk

Dow Jones

2025/07/14

0839 GMT - U.S.-South Korean tariff talks could take longer than expected because both sides should renegotiate how to share the cost of the U.S.'s military presence in South Korea, Goldman Sachs says. "Talks with Korea now include defense cost-sharing, which may slow progress," GS analysts led by Goohoon Kwon write in a research note. The issue has added complexity to trade negotiations, they say, as Seoul plans to stick to an existing 2024 agreement that requires defense cost-sharing of $1.11 billion from Seoul in 2026, while President Trump is seeking a larger Korean contribution. GS expects both sides to eventually reach a trade deal, citing shared strategic interests in manufacturing, energy and shipbuilding sectors. (kwanwoo.jun@wsj.com)

(END) Dow Jones Newswires

July 14, 2025 04:39 ET (08:39 GMT)

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The issue has added complexity to trade negotiations, they say, as Seoul plans to stick to an existing 2024 agreement that requires defense cost-sharing of $1.11 billion from Seoul in 2026, while President Trump is seeking a larger Korean contribution. GS expects both sides to eventually reach a trade deal, citing shared strategic interests in manufacturing, energy and shipbuilding sectors. 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The issue has added complexity to trade negotiations, they say, as Seoul plans to stick to an existing 2024 agreement that requires defense cost-sharing of $1.11 billion from Seoul in 2026, while President Trump is seeking a larger Korean contribution. GS expects both sides to eventually reach a trade deal, citing shared strategic interests in manufacturing, energy and shipbuilding sectors. 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The issue has added complexity to trade negotiations, they say, as Seoul plans to stick to an existing 2024 agreement that requires defense cost-sharing of $1.11 billion from Seoul in 2026, while President Trump is seeking a larger Korean contribution. GS expects both sides to eventually reach a trade deal, citing shared strategic interests in manufacturing, energy and shipbuilding sectors. 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