The United States and South Korea advanced trade talks on Wednesday, addressing details of $350 billion that would be invested in the American economy, after negotiations and ceremonies that included the presentation of a gold medal and crown to President Donald Trump.
Both were gifts from the country’s president, Lee Jae Myung, who dialed up the flattery while Washington and Seoul worked to nail down financial promises during the last stop of Trump’s Asia trip.
Although both sides said progress has been made — Trump said things were “pretty much finalized” — no agreement has been signed yet. The framework includes gradual investments, cooperation on shipbuilding and the lowering of Trump’s tariffs on South Korea’s automobile exports, according to Kim Yong-beom, Lee’s chief of staff for policy. The White House did not immediately respond to a request for comment.
The announcement came after a day of adulation for the visiting American president from his hosts. There was a special lunch menu featuring U.S.-raised beef and a gold-adorned brownie. A band played Trump’s campaign anthem of “Y.M.C.A.” when he stepped off Air Force One. Lee told him that “you are indeed making America great again.”
Trump can be mercurial and demanding, but he has a soft spot for pomp and circumstance. He was particularly impressed by a choreographed display of colorful flags as he walked along the red carpet.
“That was some spectacle, and some beautiful scene,” Trump told Lee during their meeting. “It was so perfect, so flawlessly done.”
Earlier in the day, Trump even softened his rhetoric on international trade, which he normally describes in predatory terms where someone is always trying to rip off the United States.
“The best deals are deals that work for everybody,” he said during a business forum.
Washington and Seoul have been working on a trade deal
Trump was visiting while South Korea is hosting the annual Asia-Pacific Economic Cooperation summit in the historical city of Gyeongju. He previously stopped in Japan, where he bonded with the new prime minister, and Malaysia, where he attended a summit of the Association of Southeast Asian Nations.
The Republican president has been trying to tie up trade deals along the way, eager to show that his confrontational approach of tariffs is paying dividends for Americans who are uneasy about the job market and watching a federal government shutdown extend into its fifth week.
However, South Korea has been particularly tough to crack, with the sticking point being Trump’s demand for $350 billion of direct investment in the U.S.
Korean officials say putting up cash could destabilize their own economy, and they’d rather offer loans and loan guarantees instead. The country would also need a swap line to manage the flow of its currency into the U.S.
Trump, after meeting with Lee, said “we made our deal pretty much finalized.” He did not provide any details.
Oh Hyunjoo, a deputy national security director for South Korea, told reporters earlier in the week that the negotiations have been proceeding “a little bit more slowly” than expected.
“We haven’t yet been able to reach an agreement on matters such as the structure of investments, their formats and how the profits will be distributed,” she said Monday.
It’s a contrast from Trump’s experience in Japan, where the government has worked to deliver the $550 billion in investments it promised as part of an earlier trade agreement. Commerce Secretary Howard Lutnick announced up to $490 billion in specific commitments during a dinner with business leaders in Tokyo.
For now, South Korea is stuck with a 25% tariff on automobiles, putting automakers such as Hyundai and Kia at a disadvantage against Japanese and European competitors, which face 15%.
Lee, speaking at the business forum before Trump arrived, warned against trade barriers.
“At a time when protectionism and nationalism are on the rise and nations focus on their immediate survival, words like ‘cooperation,’ ‘coexistence’ and ‘inclusive growth’ may sound hollow,” he said. “Yet, paradoxically, it is in times of crisis like this that APEC’s role as a platform for solidarity shines brighter.”
Trump and Lee swap praise despite disagreements
Lee took office in June and had a warm meeting with Trump at the White House in August, when he praised Oval Office renovations and suggested building a Trump Tower in North Korea.
He took a similar approach when Trump visited on Wednesday. The gold medal presented to Trump represents the Grand Order of Mugunghwa, the country’s highest honor, and Trump is the first U.S. president to receive it.
Trump said “it’s as beautiful as it can possibly be” and “I’d like to wear it right now.”
Next was a replica of a royal crown from the Silla Kingdom, which existed from 57 B.C. to 935 A.D. The original crown was found in a tomb in Gyeongju, the kingdom’s capital.
Besides trade disagreements, there have been other points of tension between Washington and Seoul this year. More than 300 South Koreans were detained during a U.S. immigration raid on a Hyundai plant in Georgia in September, sparking a sense of outrage and betrayal.
Lee said at the time companies would likely hesitate to make future investments unless the visa system was improved.
“If that’s not possible, then establishing a local factory in the United States will either come with severe disadvantages or become very difficult for our companies,” he said.
Asked Monday about the immigration raid, Trump said, “I was opposed to getting them out,” and he said an improved visa system would make it easier for companies to bring in skilled workers.
Trump-Xi meeting is expected Thursday
While in South Korea, Trump is also expected to hold a closely watched meeting on Thursday with Chinese leader Xi Jinping. Washington and Beijing have clashed over trade, but both sides have indicated that they’re willing to dial down tensions.
Trump told reporters aboard Air Force One on Wednesday that he expects to lower tariffs targeting China over the flow of fentanyl ingredients.
“They’ll be doing what they can do,” he said. Trump added that “China is going to be working with me.”
Trump sounded resigned to the idea that he wouldn’t get to meet North Korean leader Kim Jong Un on this trip. The president previously floated the possibility of extending his stay in South Korea, but on Wednesday said “the schedule was very tight.”
North Korea has so far dismissed overtures from Washington and Seoul, saying it won’t resume diplomacy with the United States unless Washington drops its demand for the North’s denuclearization. North Korea said Wednesday it fired sea-to-surface cruise missiles into its western waters, in the latest display of its growing military capabilities as Trump visits South Korea.
Trump brushed off the weapons test, saying “he’s been launching missiles for decades, right?”
The two leaders met during Trump’s first term, although their conversations did not produce any agreements about North Korea’s nuclear program.
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Associated Press writers Kim Tong-hyung and Hyung-jin Kim contributed from Seoul, South Korea, and Josh Boak contributed from Tokyo.
