South Korea says US trade talks need to continue past next week

South Korea, a key US ally and major manufacturing hub for cars, semiconductors, and batteries, has seen its companies caught in the crosshairs of President Donald Trump’s tariff campaign.

South Korea sees the need for trade negotiations with the US to continue past next week’s deadline as Seoul continues to seek exemptions from US tariffs including duties affecting the auto and steel industries.

A senior South Korean trade official, who asked not to be identified discussing internal matters, said it was unrealistic to expect negotiations to wrap up before across-the-board tariffs are set to rise on July 9.

Many countries will likely have to hash out details of their negotiations past the initial deadline, the official said, adding that it’s also uncertain whether South Korea will be able to secure an extension of the grace period due to what the official called a “fluid situation” in the US.

South Korea’s new Trade Minister Yeo Han-koo returned home from Washington on Sunday after holding his first meeting with US counterparts since taking up his position.

South Korea, a key US ally and major manufacturing hub for cars, semiconductors, and batteries, has seen its companies caught in the crosshairs of President Donald Trump’s tariff campaign.

In addition to sectoral duties, South Korea is subject to a 10% tax on shipments to the US that is scheduled to rise to 25% next week, barring a deal or an extension of the grace period.

US officials had previously insisted that sectoral tariffs would be off the table in their talks, but some hinted during their recent negotiations that they could consider discussing that topic depending on what South Korea might be able to offer, said the official.

The negotiations are taking place at a pivotal moment as new President Lee Jae Myung seeks to revive an economy buffeted by tariff uncertainty. South Korea’s export-reliant economy has already been hit by the US levies, with the central bank having slashed its 2025 GDP growth forecast to 0.8% from 1.5%.

Trump has indicated he doesn’t intend to extend the deadline on talks with any trading partners. “I don’t think I’ll need to,” he said in an interview on Fox News that was taped Friday. He then added, “I could, no big deal.”

South Korea publishes exports data for June on Tuesday, with early data pointing to the likelihood of a rebound in momentum fueled by surging chip shipments.