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South Korean lawmakers on Thursday passed a law to implement Seoul’s pledge of $350 billion in U.S. investments made last year as a way to avoid the Trump administration’s highest tariffs, according to the legislation’s backers and the official vote tally reported by the Associated Press. The measure passed as uncertainty mounted for the trade-dependent South Korean economy, which officials said is already being rattled by President Donald Trump’s protectionist approach and now faces additional risk linked to the war in the Middle East.
The timing of the vote also followed a fresh step by the Trump administration to pressure trade partners. Hours after the South Korean vote, the Trump administration increased pressure by opening a new investigation into manufacturing in foreign countries, including China and U.S. allies South Korea and Japan, with possible new import taxes if U.S. officials determine practices are unfair.
AP reported that the administration has signaled it wants to use new tariffs to recoup lost revenue after the U.S. Supreme Court invalidated Trump’s earlier sweeping tariffs issued with emergency powers. The AP report also said China expressed opposition to the move and urged negotiations, quoting Guo Jiakun, a foreign ministry spokesperson in Beijing, saying, “China opposes any form of unilateral tariff measures,” and adding, “Tariff wars and trade wars serve no one’s interests.”
Domestically, the South Korean law passed 226 to 8. Under the measure, the government will establish a public corporation to manage the promised U.S. investments, including reviewing and selecting projects based on input from South Korean and U.S. trade authorities, according to AP.
Some lawmakers criticized the bill ahead of the vote, with AP reporting that the dissent reflected frustration about Trump’s trade investigations and worries about how the broader conflict in the Middle East could affect South Korea’s export-driven economy and its reliance on imported fuel. One critic, Son Sol of the minor opposition Progressive Party, said, “We cannot be the money machine Trump wants us to be,” and argued the bill does not give the legislature sufficient power to review and reject investments that could conflict with South Korean business or public interests, AP reported.
The investment pledge that the law is intended to implement followed months of negotiations between Seoul and Washington. AP said South Korea and the United States finalized an agreement in November that would include $200 billion in U.S. semiconductor and other high-tech industries and another $150 billion for shipbuilding. In exchange, Washington agreed to lower reciprocal tariffs on Seoul from 25% to 15%, according to the AP account.
AP also reported that the agreement capped South Korea’s investments at $20 billion a year to protect South Korea’s foreign currency reserves. The AP report said Lee Jae Myung’s liberal Democratic Party introduced the legislation in November, and that it faced resistance from opposition lawmakers concerned about possible economic impact.
The legislative holdup, AP said, frustrated Trump, who in January threatened to raise tariffs on South Korean autos, pharmaceuticals and other goods back to 25%. That threat added pressure on the opposition to move the bill forward, leading to the Thursday vote approving the framework to carry out the $350 billion pledge.
China’s opposition to unilateral tariff measures and South Korea’s effort to secure the investment package underscore how investment commitments tied to tariff levels are being tested amid shifting U.S. trade enforcement. The AP report said the law’s passage came as South Korean lawmakers moved to reduce uncertainty after the November deal—now formalized through the new management structure—entered a more immediate phase.