The U.S. and South Korea issued a statement about a trade deal on Friday that will involve $150 billion in Korean investment in the American ship-building industry, and an extra $200 billion in the industrial sectors, the two nations announced.
This joint announcement occurred after a November meeting between South Korean President Lee Jae Myung and U.S. President Donald Trump, during which they agreed on a deal that would reduce 25 percent American import duties on products in South Korea to 15 percent.
Lee stated on Friday that “Finally, the South Korea-U.S. trade, commerce, and security negotiations, which were among the biggest variables affecting our economy and security, are … concluded.”
He added that “Good competition requires excellent partners, and I believe President Trump’s rational decision played a significant role in achieving meaningful agreement.”
Lee said that, under the agreement, South Korea would develop nuclear submarines and establish a new alliance with the U.S. in the fields of shipbuilding, artificial intelligence, and the nuclear sector.
According to a fact sheet issued by the White House, the U.S. had authorized South Korea to develop nuclear-powered submarines. It also reported that Washington will engage in close cooperation with Seoul to identify options to obtain fuel.
White House indicated that South Korea will invest in the U.S. about $350 billion with $150 billion in the shipbuilding industry.
Previously, South Korea had stated that the package of $350 billion contained $200 billion of cash, which would be in installments of not more than $20 billion of cash per year in a bid to maintain the stability of the won.
The fact sheet indicated that the two nations had “a mutual understanding” that South Korea’s investment should not “give rise to market instability” in Asia’s fourth-largest economy.
The fact sheet reported that in case of instability, South Korea was the one that could demand an “adjustment in the amount and timing of the funding, and the United States will, in good faith, give due consideration to such request.”
Lee indicated on Friday that project investments would only be restricted to commercially viable ones.
During a televised press conference on Friday, the national security adviser of Lee mentioned that the two nations had addressed the problem of nuclear submarines on the “premise” that they would build the vessels in South Korea.
Previously, Trump stated that the submarines were going to be constructed in a Korean-owned shipyard in Philadelphia.
The joint statement added that Washington “supports the process that will lead to (South Korea’s) civil uranium enrichment and spent fuel reprocessing for peaceful uses.”
The initial trade agreement was announced in July, when South Korea agreed on investment of hundreds of billions of dollars in U.S. projects in exchange for reduced tariffs.
