'No trade deal' between Seoul, Washington until Korean parliament approves agreement, Bessent warns

There will be “no trade deal” between Korea and the United States until Korea’s parliament approves legislation to implement the agreement, U.S. Treasury Secretary Scott Bessent said on Wednesday, following President Donald Trump’s threat to impose higher tariffs over the issue.

Bessent made the remarks in an interview with CNBC when asked about the signal sent by Trump’s announcement this week that he would raise tariffs on Korean goods to 25 percent from 15 percent.

"Sign the trade deal. The South Korean parliament has not passed the trade deal, so there is no trade deal until they ratify it," he said.

Asked whether the higher tariff rate would apply until parliamentary approval is secured, Bessent replied: “I think it’s helpful to get things moved along."

Seoul and Washington signed a deal last year that would lower U.S. tariffs on Korean goods in return for a $350 billion Korean investment pledge in the United States, including shipbuilding. 

The two sides released a joint fact sheet in November of last year outlining agreements on trade and security. Related legislation was submitted to Korea’s parliament the same month but remains pending.

Trump said on social media on Monday that he would raise tariffs on Korea because "the Korean Legislature hasn’t enacted our Historic Trade Agreement."

"I am hereby increasing South Korean TARIFFS on Autos, Lumber, Pharma, and all other Reciprocal TARIFFS, from 15% to 25%," he wrote in a Truth Social post.

A day later, on Tuesday, Trump signaled that he could hold off on the tariff increase depending on the outcome of discussions with Seoul.

"We will work something out with South Korea," he said.

Industry Minister Kim Jung-kwan traveled from Canada to Washington later on Wednesday and plans to meet U.S. Commerce Secretary Howard Lutnick and other officials to assess Washington’s position and explain Korea’s domestic political situation.

Separately, Bessent told CNBC the U.S. economy would continue to post strong growth this year, following last year’s performance, arguing that strong growth without inflation remained possible regardless of tariffs.

"I think we can," he said. “What causes inflation is supply constraints, and with the deregulatory agenda that we have, we are creating supply."

He also criticized the U.S. Federal Reserve in comments that echoed Trump’s calls for rate cuts.

"There are many members on the board who had a false narrative on inflation, and I hope that they will have an open mind and see what’s coming over the next couple of months," he said.

On the recent weakness of the dollar, Bessent said Washington remained committed to a strong-dollar policy.

"If we have sound policies, the money will flow in, and we are bringing down our trade deficits so [...] automatically that should lead to more dollar strength over time," he said.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.

BY KANG TAE-HWA [[email protected]]