Seoul
South Korea could see its economic growth slow due to new U.S. tariffs, which now stand at 15 percent on Korean imports. The Bank of Korea (BOK) said these tariffs represent the 18th-largest increase among America’s 50 main trading partners. Growth could fall by 0.45 percentage point in 2025 and 0.6 percentage point in 2026.
The tariff decision followed months of talks between Seoul and Washington. Initially, the U.S. planned a 25 percent tariff, but it was reduced in exchange for South Korea’s pledge to invest $350 billion in America. While this rate matches those for the European Union and Japan, South Korea had previously enjoyed zero tariffs under its Free Trade Agreement with the U.S., making the impact more severe.
According to the BOK, South Korea ranked ninth among top exporters in terms of tariff reductions after President Donald Trump’s April order. Yet, compared with pre-Trump levels, it faces the 18th-highest hike. The exposure is especially heavy in automobiles, where Korea ranks first in U.S. import reliance, as well as in steel, aluminum, copper, and semiconductors.
The central bank noted that while early impacts have been softened by exemptions and companies absorbing costs, the full effect will emerge through trade, finance, and market uncertainty. The BOK projects South Korea’s economy will grow 0.9 percent this year and 1.6 percent in 2026, but the tariff burden could reduce these figures.
