U.S. President-elect Donald Trump and Vice President-elect JD Vance attend the 125th Army-Navy football game at Northwest Stadium in Landover, Md., Saturday. AFP-Yonhap
Korea's ongoing leadership crisis, triggered by President Yoon Suk Yeol's attempt to impose martial law, is feared to leave the country vulnerable to potential new tariffs from the incoming Donald Trump administration during upcoming trade and economic negotiations, industry officials said Sunday.
Yoon is suspended from his duties following the National Assembly's vote on Saturday to impeach him over his short-lived imposition of martial law on Dec. 3. Prime Minister Han Duck-soo has stepped in as acting president.
Officials from the nation's business community expressed concerns that Korea may have weaker negotiating power under the presidency of the interim head of state.
“Every nation engages in a tight tug-of-war with the United States to minimize any damages from the ultra-protectionist stance of Trump,” an official from a major manufacturing firm here said.
“But it becomes harder for Korea to do so on an equal footing due to the absence of the state leader.”
The Constitutional Court will make a decision over whether to oust Yoon from office within the next six months. But as Trump will take office on Jan. 20 next year, chances are Korea will have to initiate trade talks with the United States amid political chaos and the absence of a sitting president, the major manufacturing firm official said.
Given that Trump returns for a second presidency, he will likely step up his trade pressure against Korea more harshly than before, another official from one of Korea's export-reliant tech firms said.
“Trump already threatens to impose a tariff of more than 10 percent on all imported goods, and Korea is no exception due to its trade surplus with the U.S.,” the official said. “It leaves much to be desired that local export players cannot (rely) more (on) the government amid the political confusion here.”
Acting President Han Duck-soo speaks with U.S. President Joe Biden at the Government Complex in Seoul, Sunday, a day after President Yoon Suk Yeol was impeached by the National Assembly. Yonhap
Trump assumed his first term as U.S. president in January 2017 when Korea was trapped in similar political turmoil. At that time, former President Park Geun-hye was also impeached by the Assembly, with then-Prime Minister Hwang Kyo-ahn serving as acting president.
Back in 2017, Trump did not hastily press Korea for trade and defense talks, as the latter was in the phase of a power transfer.
“But we cannot rule out the possibility that Trump will utilize Korea's leadership vacuum by immediately stepping up pressure on export-reliant Korean firms, such as chipmakers, automakers and battery firms, so they shoulder more financial burden in the end,” the official said.
This is because Korea's trade surplus with the U.S. has been on the gradual rise for the past few years, according to the official. The figure reached $1.14 billion (16.37 trillion won) in 2019, but surged to $44.4 billion in 2023. Trump has outwardly expressed complaints against countries that report a strong trade surplus with the U.S.
Reflecting on the possibly prolonged political uncertainty here, major conglomerates are moving to enhance their lobbying activities in the U.S. Last week, Federation of Korean Industries Chairman Ryu Jin and a group of conglomerate leaders flew to the U.S. for a joint plenary meeting with their counterparts in the world's largest economy.