Summary
- President Trump effectively confirmed the minimum reciprocal tariff rate at 15%.
- The United States agreed to apply a 15% reciprocal tariff to Japan, and announced it is also demanding a 15% tariff rate from the EU.
- Consequently, there is speculation that South Korea is also likely to face tariffs of 15% or higher.
"Will impose between 15~50%"
EU Likely to Settle at 15% Following Japan
President Donald Trump of the United States has effectively set the minimum reciprocal tariff rate at 15%. After Japan, it has been reported that the European Union (EU) is also likely to accept a 15% tariff rate.
On the 23rd (local time), President Trump stated at the Artificial Intelligence (AI) Summit held in Washington, D.C., "There are too many countries, so it’s not possible to make agreements with them all,” adding, "For most of the remaining countries, we will impose a simple tariff between 15% and 50%." In effect, he proposed a minimum tariff rate of 15%. He further commented, "For a few countries, we apply 50% because our relations with them are not good."
The Trump administration has been negotiating with countries since the announcement of reciprocal tariffs in April. During the negotiation period, only a basic tariff of 10% is applied, but starting in August, reciprocal tariffs as previously announced will be imposed. Consequently, countries have made it a priority to either abolish reciprocal tariffs or lower them to around 10%.
On the previous day, the United States agreed with Japan to set a 15% reciprocal tariff on Japanese products. It is known that the US is also demanding a 15% rate from the EU. The Wall Street Journal (WSJ) reported that both sides are negotiating a trade deal under which the US would apply a 15% tariff rate to most EU goods. Financial Times (FT), also quoting sources, reported that both sides are gathering support for a reciprocal tariff rate of 15% in order to avoid the 30% tariff President Trump warned would be applied to the EU starting the first of next month. FT stated, "After the agreement between the US and Japan, the EU was reluctantly forced to accept a higher tariff rate to avoid a devastating trade war." As a result, there is a rising expectation that the reciprocal tariffs applied to South Korea may also exceed 15%.
Hankyungje reporter hankyung@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
