Trump wants $350 bn investment in South Korea, but deal is challenging
Following a strategic outreach in Japan that resulted in $490 billion in investment commitments, President Donald Trump is scheduled to meet with South Korea’s leader on Wednesday, as negotiations for a trade deal with that nation seem increasingly challenging. Top officials in Washington and Seoul indicate that the primary obstacle to reaching an agreement remains the logistics surrounding Trump’s request for South Korea to invest $350 billion in the United States. Korean officials express concerns that a direct cash injection could destabilize their economy, preferring to pursue loans and loan guarantees instead. The nation would also require a swap line to regulate the movement of its currency into the US. The gap between Trump’s demands and South Korea’s capabilities looms large over the upcoming meeting with South Korean President Lee Jae Myung in Gyeongju, a city steeped in history that will host the annual Asia-Pacific Economic Cooperation summit. Oh Hyunjoo, a deputy national security director, informed reporters that the negotiations have been advancing at a somewhat slower pace than anticipated.
President Donald Trump, left, and Japan’s Prime Minister Sanae Takaichi engage in a handshake during a signing ceremony at Akasaka Palace in Tokyo, Japan, on Tuesday, Oct. 28, 2025. Japan’s Prime Minister informs Trump of her nomination of him for the Nobel Peace Prize. “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,” he said Monday. In stark contrast to Trump’s experience in Japan, the government has diligently pursued its commitment of $550 billion in investments as outlined in a previous trade agreement. Commerce Secretary Howard Lutnick announced commitments of up to $490 billion during a dinner with business leaders in Tokyo. Tuesday’s trip saw Trump connect with Japan’s incoming prime minister, Sanae Takaichi. He included her in his address to US troops aboard an aircraft carrier and subsequently announced several significant energy and technology initiatives in America that will receive funding from Japan.
In contrast, US Treasury Secretary Scott Bessent, addressing reporters aboard Air Force One on Monday, stated that a deal wasn’t ready in South Korea. There are numerous details to finalize, he stated, though he indicated that they were nearing a resolution. Currently, South Korea is burdened with a 25 per cent tariff on automobiles, placing automakers like Hyundai and Kia at a disadvantage compared to their Japanese and European counterparts, who are subject to a 15 per cent tariff. Lee assumed his position in June and engaged in a cordial meeting with Trump at the White House in August, during which he intensified his compliments. However, there have been moments of tension since that time, particularly highlighted by a US immigration raid on a Hyundai plant in Georgia in September. Over 300 South Koreans were taken into custody, igniting outrage and a profound sense of betrayal. Lee stated that companies would probably be reluctant to pursue future investments unless there were enhancements to the visa system.
“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. “They will question whether they should even proceed with it.” In early October, South Korea’s Foreign Ministry announced that the United States had consented to permit South Korean workers on short-term visas or through a visa waiver program to assist in the construction of industrial sites in America. When questioned on Monday regarding the immigration raid, Trump stated, “I was opposed to getting them out,” and he emphasized that an enhanced visa system would facilitate the process for companies to recruit skilled workers. During his time in South Korea, Trump is anticipated to engage in a highly scrutinized meeting on Thursday with Chinese leader Xi Jinping. Washington and Beijing have engaged in a confrontation regarding trade; however, both parties have expressed a readiness to reduce tensions. He has also suggested the potential for a meeting with North Korean leader Kim Jong Un, conveying disappointment that Kim has not yet replied to his overtures. “I had a positive relationship with Kim Jong Un. I had a fondness for him. He liked me,” Trump said. “If he wants to meet, I’ll be in South Korea.” Trump even stated he would be open to extending his trip — South Korea is his last planned destination — should there be a chance to engage in dialogue with Kim. The two leaders convened during Trump’s initial term, yet their discussions failed to yield any agreements regarding North Korea’s nuclear program.
