GYEONGJU – South Korean President Lee Jae Myung and US President Donald Trump will meet on Wednesday in the South Korean historic city of Gyeongju for what could be the final push to conclude months of stalled tariff negotiations – talks that will determine whether Korean-made cars and other key products continue to face steep 25% import duties or lower tariffs in the US.
The two leaders are expected to attempt to bridge remaining gaps over the Seoul-proposed $350 billion US investment fund, a central pillar of a broader trade and security package.
Officials on both sides, however, warn that the prospects of a comprehensive deal remain uncertain.
According to the presidential office in Seoul, Lee cleared his public schedule on Tuesday to receive detailed briefings on the trade and security discussions ahead of the summit, held on the eve of the APEC leaders’ meeting.
“All major issues have been thoroughly reviewed,” said a senior official, adding that President Lee “will make final decisions with the national interest as the top priority.”
The Gyeongju summit comes two months after the leaders met face-to-face at the White House in August.
Since then, negotiations have been bogged down over how much of the $350 billion fund would take the form of direct cash investment and how profits would be distributed – points US negotiators have tied to tariff relief.
LAST-DITCH DIPLOMACY
Seoul’s Industry and Trade Minister Kim Jung-kwan has held at least two online meetings in recent days with US Commerce Secretary Howard Lutnick to discuss details of the investment package.
“Talks are ongoing in various formats until the very last moment,” said a senior Korean trade official.
Yet optimism remains in short supply.
US Treasury Secretary Scott Bessent said en route to Japan on Monday that while “the overall framework is in place,” many technical issues still need to be resolved.
Korean Foreign Minister Cho Hyun told lawmakers in Seoul on Tuesday that he was “not confident” a tariff deal MOU could be signed during the summit.
With time running short, Seoul and Washington may settle for a political declaration committing to an early conclusion, rather than a legally binding deal, analysts said.
Such an outcome would leave the 25% automotive tariffs in place until a final agreement is reached.
Still, Seoul has not given up hope.
“Both sides are squeezing each other to the last minute,” said a source familiar with the talks.
Foreign Minister Cho said that given Trump’s unpredictable negotiating style, “he could make concessions at the last moment,” leaving room for a surprise breakthrough.
SECURITY AGENDA TIED TO OUTCOME OF TARIFF TALKS
The tariff agreement will also determine whether the two leaders announce a long-awaited security accord granting South Korea expanded rights to enrich uranium and reprocess spent nuclear fuel.
Seoul officials said three outcomes are possible: a comprehensive tariff-and-security package, a partial deal excluding tariffs, or no announcement at all.
“Even if tariff talks fail, the security discussions could still be concluded separately,” Cho told Parliament.
While Washington reportedly favors a joint package, Seoul is weighing a separation of trade and security tracks to avoid a comprehensive deal being held hostage to tariff disputes.
Should last-minute coordination succeed, the summit could culminate in a joint statement or declaration, formalizing the leaders’ political commitment, analysts said.
Though such documents carry no legal force, they signal intent and lay the groundwork for subsequent treaties or domestic legislation.
“Whether we see a breakthrough or just another postponement, this meeting will define the trajectory of the Korea-US alliance for years to come,” said a Seoul official.
