The United States and South Korea have unveiled details of a trade and security agreement that includes a $150 billion South Korean investment in U.S. shipbuilding and an additional $200 billion earmarked for strategic industrial sectors.
The deal follows an October summit between South Korean President Lee Jae Myung and U.S. President Donald Trump, during which they agreed to reduce U.S. import duties on South Korean goods, including autos and semiconductors, from 25% to 15%.
As part of the agreement, South Korea will form a partnership with the U.S. covering shipbuilding, artificial intelligence, and the nuclear industry, and will begin building nuclear-powered submarines. The U.S. will also collaborate with Seoul to source fuel for the vessels and expand nuclear energy capabilities.
A 27-point non-binding Memorandum of Understanding was signed by South Korea’s Industry Minister Kim Jung-kwan and U.S. Commerce Secretary Howard Lutnick, laying out implementation schedules for strategic investments. South Korea’s $200 billion cash investment will be delivered in annual installments of no more than $20 billion to maintain currency stability.
President Lee described the agreement as a major diplomatic and economic achievement, saying it would help rebuild critical industries, strengthen security cooperation, and advance South Korea’s position in high-tech and defence sectors.
The deal also establishes tariff terms for semiconductors at levels no less favourable than those applied to Taiwan, further securing South Korea’s access to the U.S. market.
