Tariffs, South Korea holds back on 350 billion investment promised to Trump
In an interview with the Reuters news agency, Finance Minister Koo Yun-cheol said without mincing words that it is 'unlikely' that there will be any investment in the first half of the year
From our correspondent
NEW DELHI - At the very least, it will be some time before South Korea starts investing in the United States the $350 billion it promised last November to the Trump administration in exchange for a reduction to 15% of tariffs on its exports. Seoul does not seem, at least for the moment, willing to back down from its onerous commitment to end a trade negotiation conducted in extortionate tones. But in an interview granted to the Reuters news agency, Finance Minister Koo Yun-cheol said without mincing words that it is 'unlikely' that there will be any investment in the first half of the year.
Referring to a clause in the agreement whereby South Korea would invest a maximum of USD 20 billion per year, Koo explained that 'even if, for example, a nuclear power plant project were selected, procedures would have to be followed for site identification, plant design, and construction, so the initial cash flows would be much smaller' than the ceiling set with the US president's negotiators.
A formula that behind a technical explanation hides a criticality and a hope. The first has to do with the recent precipitous depreciation of the won, which has already lost more than 2% against the dollar since the start of the year and during yesterday's session fell to its lowest level in 16 years, before retracing.
Today 16 January Koo said that with these exchange rates 'no big investments can be made, at least for this year', adding that the South Korean authorities have no intention of overdoing regulatory interventions to curb the currency's decline.
