By Heejin Kim and Jihoon Lee SEOUL (Reuters) -Two weeks after U.S. President Donald Trump and South Korea’s Lee Jae Myung met and announced they had resolved months of negotiations over tariffs and security issues, the two sides have yet to release any agreement on paper. South Korean officials say the delay appears to centre on […]
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Trump’s deal with South Korea bogged down in details over submarine
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By Heejin Kim and Jihoon Lee
SEOUL (Reuters) -Two weeks after U.S. President Donald Trump and South Korea’s Lee Jae Myung met and announced they had resolved months of negotiations over tariffs and security issues, the two sides have yet to release any agreement on paper.
South Korean officials say the delay appears to centre on discussions over their request for Washington’s blessing to build a nuclear-powered submarine, which Lee raised publicly when he met Trump on the sidelines of an Asia-Pacific forum in South Korea last month.
After that meeting, officials said they would shortly release a factsheet outlining an agreement on security issues including the submarine, as well as a trade deal first announced at the first Trump-Lee summit in July, under which South Korea would shovel hundreds of billions of dollars into U.S. projects in exchange for lower tariffs.
“Since the matter of building a nuclear-powered submarine has been raised, each of the U.S. departments seems to need some time to adjust their opinions,” South Korean Defence Minister Ahn said in an interview with local broadcaster KBS on Sunday.
Washington has approved Seoul’s use of nuclear fuel for the submarine but the factsheet is taking longer to finalise because relevant U.S. departments are still giving feedback and there continue to be adjustments on the wording, a senior South Korean presidential official said on Friday.
The White House did not immediately respond to a request for comment.
The won weakened as much as 0.7% on Tuesday to hit the lowest level in seven months at 1,467.5 per dollar, weighed by worries about the delayed factsheet.
FINAL STAGES
Lee’s position on building the submarine in South Korea also appears at odds with Trump’s recent comments on social media, saying it was approved but would be built at a U.S. shipyard. Analysts say there are questions over U.S. willingness to transfer sensitive technology.
The negotiations over the submarine come as the two sides say they have reached an agreement on trade. Disagreements over the structure of the investment fund prevented any joint statements after Lee and Trump’s earlier meetings.
“When it comes to tariffs, the draft can be seen finalised and will be made public when the joint factsheet is ready to be announced,” a trade ministry official said.
Industry Minister Kim Jung-kwan told a parliamentary hearing on Tuesday that negotiations over the joint factsheet were in their final stages, without providing details on the timing of an announcement.
South Korean carmaker Hyundai Motor, whose battery facility in the U.S. state of Georgia was raided by immigration authorities in September, is losing about 300 billion won ($211.05 million) every month because the delayed tariff deal is hurting its exports to the U.S. market, Kim said.
A memorandum of understanding on South Korea’s $350 billion investment package is also ready, but it has not been signed and how and when to sign it is also yet to be determined, the official said.
“We are waiting for that because we need it to be officially announced to take follow-up measures, such as explaining to parliament about it,” the trade ministry official said.
(Reporting by Heejin Kim and Jihoon Lee in Seoul; Additional reporting by Trevor Hunnicutt and David Brunnstrom in Washington; Editing by Saad Sayeed)