Among many countries being affected by the United States’ steep aluminium and steel tariffs, South Korea claims to be one of them. The country that was once an important trade partner of the United States, back from 2007 with the signing of the Free Trade Agreement (FTA), is now one of the major victims of the United States’ latest protectionist measures. Firstly, the implementation of 25 per cent duty was enough to blow the country, while the subsequent hike by another 25 per cent has proved to be the final nail in the coffin.
Being a significant aluminium and steel exporter to the United States (valued at USD 851 million in 2024), South Korea says it has taken a major hit on its economy due to Donald Trump’s tariff regime. Its exports to the US in the month of August slid 12 per cent year-on-year to USD 8.7 billion, the steepest fall since May 2020 when COVID-19 broke out. Also, the figure, for the first time, stood below the USD 9 billion threshold.
South Korea’s factory activity also weakened for the seventh consecutive month in August, coming in at 48.3, down below the 50 mark. This sluggish factory activity is also a resultant of lower export orders.
"According to manufacturers, challenging domestic economic conditions and the impact of US tariffs weighed most on the sector, stymieing sales and production levels," said Usamah Bhatti, economist at S&P Global Market Intelligence.
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