Seoul, Nov 14 South Korea's automaking and shipbuilding industries on Friday welcomed the Seoul-Washington joint fact sheet finalizing their trade and security agreements that would lower import tariffs on key items and support Seoul's plans to build a nuclear-powered submarine.
According to the fact sheet released by the Presidential Office, the United States will cut tariffs on imported Korean cars and auto parts from 25 per cent to 15 per cent. Korean semiconductors will also be subject to tariff rates "no less favourable" than those applied to competitors, such as Taiwan.
In addition, the South Korean government secured U.S. approval for its bid to build nuclear-powered submarines and the right to reprocess spent nuclear fuel, reports Yonhap news agency.
The announcement came more than two weeks after Korean President Lee Jae Myung and U.S. President Donald Trump reached such an agreement in a bilateral summit held on the sidelines of the Asia-Pacific Economic Cooperation (APEC) forum in South Korea's southeastern city of Gyeongju on Oct. 29.
Following the fact sheet announcement, Hyundai Motor Group issued a statement welcoming the fact sheet release.
"Hyundai Motor Group expresses its gratitude to the Korean government for its dedicated efforts to protect the national interest throughout the challenging negotiation process, which culminated in the tariff agreement, the joint fact sheet announcement and the signing of the investment fund memorandum of understanding (MOU)," the automotive giant said.
The group added it will pursue various measures to minimize the impact of tariffs while further strengthening its fundamentals through enhanced product quality, brand competitiveness and technological innovation.
Previously, Hyundai Motor Group Executive Chair Euisun Chung thanked President Lee for the Korea-U.S. trade deal while meeting with the president on the sidelines of the APEC forum late last month.
Although not specified in the fact sheet, the two countries agreed that the tariff reductions for automobiles and auto parts will take effect retroactively on the first day of the month in which the legislation necessary to implement the investment fund MOU is submitted to the National Assembly.
If the bill is introduced within this month, the tariff cut could be applied retroactively from Nov. 1.
Korean carmakers will also need to adjust production and supply chains to minimize the impact of the 15 percent tariffs after more than a decade of tariff-free exports under the Korea–U.S. Free Trade Agreement (KORUS) before Trump imposed a series of sector-specific and country-specific reciprocal tariffs.
"The completion of the fact sheet is a great relief and a fortunate development for the industry," said Kang Nam-hoon, president of the Korea Automobile and Mobility Association.
"Automakers will need to expand U.S. production systems in response to tariffs rising from zero to 15 percent, which could pose risks to the Korean automotive ecosystem," he said, calling for government incentives to encourage domestic production.
The shipbuilding sector, which has been highlighted as a symbol of Korea–U.S. industrial cooperation under a Seoul-proposed "Make American Shipbuilding Great Again" (MASGA) initiative, also voiced support for the strengthened collaboration reflected in the fact sheet.
"We welcome the finalisation of the fact sheet on Korea–U.S. trade and security deals," said Hanwha Group, which oversees Hanwha Ocean Co. and Hanwha Philly Shipyard Inc.
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