SEOUL (Reuters) -South Korean Finance Minister Koo Yun-cheol said on Tuesday it was “huge progress” that the U.S. was not insisting that South Korea make all of the $350 billion investments, promised in a trade deal reached in July, in the form of direct investment.
There have been differences between how Seoul and Washington view the investment package, with the former saying it will mostly comprise loans and guarantees and the latter saying it will be paid “upfront”.
Officials in Seoul have argued that such a large direct investment would have domestic foreign exchange implications, warning that the ensuing dollar demand in the domestic currency market would weigh heavily on the won.
Koo’s comments on Tuesday come a day after he said Washington now understood South Korea’s concerns “to some degree” and Foreign Minister Cho Hyun noted there were “some positive signals” from the United States.
“That all of $350 billion will not be in cash itself is huge progress,” Koo said at a parliamentary hearing held on Tuesday. He added the two sides were negotiating at the working level over how the package would be set up.
Koo said he planned to meet U.S. Treasury Secretary Scott Bessent and make the case directly to him.”I plan to tell him that money is not important for the U.S. and projects need to start quickly,” Koo said.
Koo is scheduled to travel to Washington this week to attend a multilateral meeting of finance ministers. He said on Monday a meeting with Bessent was also being coordinated.
South Korea sent a revised trade proposal last month after expressing concern that there would be a financial crisis if it accepted U.S. demands as they were. The country aims to conclude the deal by late October, when U.S. President Donald Trump will visit the country for an Asia-Pacific summit.
(Reporting by Jihoon LeeEditing by Ed Davies)
