Michelle Steel, the Korean American nominee for U.S. Ambassador to South Korea, signaled the possibility of renegotiating the Korea-U.S. Free Trade Agreement (KORUS FTA) at her U.S. Senate confirmation hearing on the 20th. "Korea is running a trade surplus of more than $50 billion through the FTA," Steel said, adding that she looked forward to "the process of exploring ways for the United States to export more to Korea through renegotiation." Regarding the $350 billion investment in the United States that the Korean government has pledged, she took an aggressive stance, saying she would "verify exactly where it is coming from." On the Coupang issue, she also previewed a hardline position on trade matters by emphasizing market access for American companies.
Concerns that the Donald Trump administration would use Korea's $49.5 billion trade surplus with the United States (as of 2025) as a card for KORUS FTA renegotiation are nothing new. However, it is no ordinary matter for a nominee for U.S. Ambassador to Korea to flag trade pressure so openly even before taking up the post. Although Steel pledged to "be committed to strengthening the Korea-U.S. alliance," a sophisticated response is needed to ensure that trade pressure does not lead to cracks in the alliance.
A more complicated problem is that trade and security agendas are intertwined. Major security issues are piling up between Seoul and Washington, including cooperation on nuclear-powered submarines, the expansion of rights to reprocess spent nuclear fuel, and the transfer of wartime operational control. Within weeks, a U.S. government delegation will visit Korea, and a Korea-U.S. fact sheet working group will be launched. In such circumstances, if trade and security issues become negatively entangled, they could lead to serious deadlock in negotiations.
Since demands for KORUS FTA renegotiation could surface at any time, the government must make full preparations. Before the renegotiation issue erupts, it is necessary to closely analyze the impact by industry and to overhaul negotiation strategies on multiple fronts. Above all, this is the time to actively defend core export industries such as semiconductors and automobiles, and to refine countermeasures to block excessive demands for market opening that would harm the interests of Korean companies and industries. Although there are issues between Seoul and Washington — such as Unification Minister Chung Dong-young's "rudimentary nuclear facilities" remark and U.S. restrictions on sharing intelligence on North Korea — the two sides have been narrowing differences through recent leader-to-leader phone calls. Going forward, sophisticated and smooth communication must ensure there are no gaps in the Korea-U.S. alliance.
