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Trump Threatens South Korea with New Tariffs 

Stephanie Bulega-Nasuna

On January 26, President Donald Trump accused South Korea of not upholding its end of the trade deal. In a post to social media platform TruthSocial, President Trump wrote, “South Korea's Legislature is not living up to its Deal with the United States. President Lee and I reached a Great Deal for both Countries on July 30, 2025, and we reaffirmed these terms while I was in Korea on October 29, 2025. Why hasn't the Korean Legislature approved it?” In the same post, he then went on to announce that all tariffs on South Korean goods would be increased from 15% to 25%.  

According to the South Korean Presidential Office, Seoul did not receive any official explanation from the White House. Moreover, the United States did not issue any form order altering current tariff rates. On January 29, Seoul sent Industry Minister Kim Jung-kwan to explain the situation  to the U.S. Secretary of Commerce Howard Lutnick. Two days and multiple meetings failed to produce a resolution. Minister Kim explained to reporters, “Further dialogue is needed, and no conclusion has been reached. Our understanding of each other’s positions has deepened, and there was discussion on how to find a compromise.” Minister Kim emphasized, the South Korean government will collaborate with the National Assembly to pass the “Special Act on Investment in the United States.” ​​This law supports the U.S-South Korea tariff agreement proposed from last year November. The law describes the procedures to establish the 350 billion dollars of investment into the United States. However, the National Assembly Standing Committee has not reviewed it once. President Trump referred to this law in his TruthSocial post.

Additionally, he voiced his intention  to reach some form of accommodation with South Korea. However, despite interest on both sides to solve this conflict,  there are several roadblocks. First, for the South Korean government to implement the trade deal, a special fund has to be created with foreign currency to not disrupt the South Korean market.  The People Power Party, (PPP) argues that legislative ratification is necessary which the Democratic Party of Korea (DPK), the majority party disagrees with. DPK lawmakers highlight that Japan reached a tariff deal with the United States without National Diet ratification. In contrast, PPP lawmakers accuse the Lee Jae-Myung administration of irresponsible, backroom diplomacy and think the contents of the agreement should be disclosed publicly. The PPP response to the tariff deal is influenced by the upcoming local elections in June. However, the PPP and DPK lawmakers scheduled meetings to discuss tariff concerns. Ultimately, both the ruling and opposition party did not pass the bill quickly, and only began discussion after President Trump’s threats.

The U.S.-South Korea trade agreement faces increased uncertainty despite good intentions on both sides. President Trump’s foreign policy values short-term gains over long term geostrategy. South Korea’s legislative process is not equipped to work at the speed Trump desires. President Trump views U.S. alliances through a transactional lens, therefore it aligns with his policy to threaten South Korea. However, some argue President Trump’s foreign policy is purposely unpredictable to achieve U.S. goals abroad. The future of U.S-South Korea relations will be determined on South Korea’s ability to show true commitment to its relations with the United States. For President Trump, the “true” commitment is through financial investment. President Trump is signaling through South Korea, for other partners in the Indo-Pacific they have to act fast on their commitments or face swift repercussions. 

Canada Expands Manufacturing Ties with South Korea as it Anticipates Hyundai-Hanhwa Submarine Bid

Sophia Shum Gagnier

Last week, a South Korean delegation arrived in Canada to meet with Canadian officials and business leaders to expand bilateral cooperation amid South Korea’s pursuit of the Canada Patrol Submarine Project (CPSP). The visit culminated in the publication of a Memorandum of Understanding (MOU) that cited auto and battery manufacturing, critical minerals, and AI as areas for future  collaboration.

Canada’s domestic politics make South Korea an ideal partner, particularly in the auto-manufacturing sector. Canada has committed to the decarbonization of its transport industry and 100% zero-emission vehicle sales by 2035 for all new light-duty vehicles. The MOU specifically highlighted the two countries’ intentions to investigate increasing South Korean EV manufacturing opportunities within Canada, and the billions of dollars previously invested by South Korean companies in Canadian EV infrastructure. Currently, South Korean companies hold a 12% share of automobile sales in Canada, but do not operate any manufacturing plants in the country. 

The MOU is one of two Canadian agreements with Asian partners on EVs since the start of the new year. On January 16, Canadian Prime Minister Mark Carney negotiated an increased allowance of 49,000 Chinese-made EVs to be imported into Canada at the most-favored-nation tariff rate of 6.1%. Canadian politicians and policy experts expressed virulent opposition to the agreement, citing national security concerns. Increased South Korean presence is unlikely to incite such alarm while also aiding Canada’s automobile industry in the face of the Trump administration's 25% tariffs on Canadian-made cars and auto-parts. New automobile manufacturing jobs would bolster Canada’s defense of its automobile sector, which contributed $16.8 billion to the country’s GDP in 2024 and complement the thousands of jobs already created in the EV battery manufacturing industry created by South Korean company LGES in 2022. 

The delegation’s visit coincides with South Korean conglomerates Hyundai and Hanwha’s joint bid to manufacture the Royal Canadian Navy’s new fleet of submarines. The Canadian government is looking to purchase 12 replacement submarines for its aging fleet — a project expected to pay out  CAD100 billion over the next three to four decades. Hyundai and Hanwha have pitched its KSS-3, an Arctic-capable submarine, and remain in competition with Germany’s TKMS until a manufacturer is picked in the coming months. As part of its bid, South Korea welcomed Canada’s Secretary of State for Defense Procurement, Stephen Fuhr, who toured Hanwha’s shipyard on February 2. Last month, Hanhwa also announced a series of new strategic partnerships with Canadian companies in order to shore up supplies for its potential submarine contract. Its contract with Algoma Steel alone promises to create an estimated 15,000 jobs in Canada for the construction of a new steel mill in Sault Ste. Marie, Ontario.   

These developments paint a picture of increasingly close ties between Canada and South Korea. As of fall 2025, the two countries have embarked on a project to increase military cooperation, including a new intelligence sharing agreement as of last week, and with Canada’s goal to diversify trade partners in light of U.S. unpredictability, the relationship with South Korea could be key to achieving Canada’s economic stability and stated goals, especially as it comes without the political baggage of partnering with China on key economic sectors.

This Week in Korean History

On February 8, 1948, North Korea formally established the Korean People’s Army (KPA), creating its first regular, standing military force. The founding was publicly proclaimed in Pyongyang by North Korean dictator Kim Il Sung and accompanied by a military parade, several months before the official creation of the Democratic People’s Republic of Korea. This date later became commemorated as Military Foundation Day, marking a key step in the institutional formation of the North Korean state.