President Lee Jae-myung on the 24th (local time) met with U.S. Treasury Secretary Scott Bessent and, regarding follow-up talks on an investment in the United States worth 350 billion dollars (about 488 trillion won), said, "Based on commercial rationality, I expect discussions to move forward in a way that aligns with the interests of both countries." In particular, although the United States and Japan signed an investment memorandum of understanding (MOU) centered on "cash deposits," he reportedly stressed that the differences in economic scale and foreign exchange market conditions between Korea and Japan, among other factors, must be taken into account in the negotiations.
According to Presidential Chief of Staff for Policy Kim Yong-beom, President Lee received Secretary Bessent for about 30 minutes that day at the Republic of Korea's U.N. Mission in New York. It was the second time the two had met since last month, when the treasury secretary sat in on the South Korea–U.S. summit with President Donald Trump. At the meeting, Lee said, "Although the United States and Japan recently agreed on an external investment package, Korea differs greatly from Japan in economic scale, the foreign exchange market, and infrastructure," conveying that he hoped negotiations would proceed with these aspects in mind.
On this, Secretary Bessent said, "I understand that there are many difficulties even in the trade sector related to trade negotiations," listened to President Lee's explanation, and replied that the matter would be sufficiently discussed internally, Kim said. However, since the key figure in the tariff negotiations is Commerce Secretary Howard Lutnick, it is uncertain whether the U.S. side will actually accept these points. The 350 billion dollars amounts to 84% of Korea's foreign exchange reserves, and Lutnick is sticking to the position that a direct investment MOU must be concluded to apply a cut in auto tariffs (25%→15%).
◇"After the tariff negotiations were concluded, the document the U.S. sent was far different from what we expected"
Regarding the 350 billion-dollar investment talks being at an impasse, Kim said that the MOU the U.S. side provided at the end of Jul. when the South Korea–U.S. tariff negotiations were concluded differed greatly from the customary form. Kim said, "In light of international investment practices, we expected that most of the (investment funds in the United States) would be loans and guarantees, with some direct investment. We noted this in our memorandum," adding, "But the MOU document the United States subsequently sent us was drastically different from that content." He also said, "It became clear that the 'cash flow' the United States argued for was, to a considerable extent, close to equity (direct equity investment)."
He continued, "If so, we could see that it was quite different from what we were talking about," adding, "In that sense, if we go by the U.S. position, we expected a significant shock to our foreign exchange market, and that is what we are pointing out to the United States." Korea's negotiating team holds the position that loans, guarantees, and direct equity investment should be distinguished and all included, but the U.S. side is not accepting this. The United States, effectively following the approach negotiated with Japan, wants "cash remittances."
Kim said, "We are negotiating so that the cash flow has as much as possible the attributes of a loan," but added, "In any case, the (U.S.) proposal is being made in a form different from reasonable, customary negotiations, which presents difficulties." He continued, "We also face deadlines, and the auto industry is having difficulties because tariffs are not coming down," adding, "We will make sure the MOU is concluded and a final agreement is reached to suit our national interest and to ensure reciprocity, feasibility, and commercial rationality."