Gyeongju, South Korea (AP) — Charm offensive in Japan President Donald Trump is scheduled to meet with South Korea’s leader on Wednesday, as a trade deal with South Korea looks even more elusive, culminating in $490 billion in investment pledges.
Officials in Washington and Seoul say the logistics behind President Trump’s request for South Korea to invest $350 billion in the United States continue to be a sticking point in the deal.
South Korean officials have said direct cash injections could destabilize the economy, so they prefer to make loans or loan guarantees instead. The country would also need a swap line to manage the flow of currency to the United States.
The disconnect between what President Trump wants and what South Korea can achieve threatens to cast a shadow over the meeting between Trump and South Korean President Lee Jae-myung in the historic city of Gyeongju. Annual Asia-Pacific Economic Cooperation Conference.
Deputy National Security Minister Oh Hyun-joo told reporters that negotiations were progressing “a little more slowly” than expected.
“We have not yet reached an agreement on the structure and format of the investment and how the profits will be distributed,” he said on Monday.
This contrasts with President Trump’s experience in Japan, where the government was working to meet $550 billion in investment commitments as part of a previous trade deal. Commerce Secretary Howard Lutnick announced the pledge of up to $490 billion at a dinner with business leaders in Tokyo.
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Trump befriended Japan’s new prime minister, Sanae Takaichi, on Tuesday’s visit, taking her with him as he met with U.S. soldiers on an aircraft carrier before announcing several major U.S. energy and technology projects that would be funded by Japan.
By contrast, U.S. Treasury Secretary Scott Bessent told reporters aboard Air Force One on Monday that South Korea is not ready for a deal.
“There are a lot of details that need to be worked out,” he said, but suggested a deal was close.
For now, South Korea is locked into a 25% tariff on cars, putting automakers like Hyundai and Kia at a disadvantage against Japanese and European competitors who face 15% tariffs.
Lee took office in June and had a warm meeting with Trump at the White House in August. I was flattered. But since then, there have been some tension points. US immigration raids At a Hyundai plant in Georgia in September. More than 300 Koreans were detained, sparking anger and a sense of betrayal.
Mr Lee said companies were likely to be reluctant to make future investments unless the visa system was improved.
“If that is not possible, establishing a local factory in the United States would either be at a significant disadvantage or would be extremely difficult for us,” he said. “They’re going to wonder if they should do it.”
South Korea’s Ministry of Foreign Affairs announced in early October that the United States had agreed to accept South Korean workers on short-term visas or visa waiver programs to help build industrial sites in the United States.
Asked about the immigration raids on Monday, President Trump said he was “opposed to kicking them out” and said improving the visa system would make it easier for businesses to hire skilled workers.
Trump is also expected to hold close talks with Chinese leader Xi Jinping on Thursday while in South Korea. The U.S. government and China are at loggerheads over trade, but each side has taken a stand. Willingness to relieve tension.
He also teased a possible meeting with North Korean leader Kim Jong Un and expressed disappointment that Kim had not yet responded to his advances.
President Trump said, “I was very good friends with Kim Jong Un. I liked Kim Jong Un. He liked me.” “If he wants to meet, I’ll be in Korea.”
President Trump even said he would be willing to extend his visit if he had the chance to meet with Kim, as South Korea is his last scheduled stop.
The two leaders met during President Trump’s first term, but no agreement was reached regarding North Korea’s nuclear program during their conversations.
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Associated Press writers Kim Tong-hyun and Kim Hyun-jin contributed from Seoul, South Korea, and Josh Bork contributed from Tokyo.
