US Presses South Korea for Nuclear Energy Investment Amid Tariff Threats

The federal government of the United States is pressing South Korea to begin executing a $350 billion investment pledge, specifically targeting the nuclear energy sector. This pressure follows a 2025 agreement intended to mitigate trade tensions. Donald Trump announced on January 26 plans to increase reciprocal tariffs on South Korean goods from 15% to 25%, citing delays in the investment's implementation compared to Japan's $332 billion commitment to critical infrastructure.

In late January, South Korean Minister of Trade, Industry and Resources Kim Jung-kwan met with U.S. Secretary of Commerce Howard Lutnick in Washington to discuss the energy projects. South Korea has proposed focusing on small modular reactors, aiming to pair U.S. technological expertise with Korean construction capabilities to support the administration's goal of quadrupling nuclear power generation by 2050. South Korean officials suggested handling nuclear plant construction as a separate track to increase negotiating leverage.

The South Korean government maintains that finalizing specific sectors is premature until the National Assembly passes domestic legislation to oversee the investment fund. While Seoul seeks to delay the tariff hike until this legislation is approved, U.S. officials have not yet granted the request, and South Korean reports suggest the tariff increase is already awaiting the president's signature.