The Republican candidate Donald Trump won the United States presidential election on November 5th. The U.S. presidential election is a significant political event that influences not only the US but also the entire world, including South Korea. This column examines the impact of the election results on South Korea, focusing on two aspects: the economy and security.
First, one of Trump’s notable characteristics is his aggressive trade pressure. Many experts predict that, based on the trade policies of the first Trump administration and statements during the campaign, the second Trump administration will impose high tariffs and demand significant investment in the US, which may cause substantial damage to South Korea’s economy. However, such predictions overlook two critical aspects. The first aspect is that one of the main reasons behind Trump’s victory in this election was the severe inflation crisis in the US. High tariffs can reduce trade deficits, but also raise product prices and decrease supply. These effects of high tariffs may aggravate inflation. This could critically undermine the stability of Trump’s second administration. Therefore, unlike during his first term, it will be challenging for Trump to implement high tariffs during his second term. His statements regarding strong tariff barriers should be understood as bluffing to gain leverage in trade negotiations with other states. Moreover, South Korean growing trade surplus with the US is caused by the investment of South Korean companies in the US. Thus, if the second Trump administration attempts to reduce South Korean trade surplus with the US, it could damage South Korean investment in the US Additionally, most regions where South Korean companies are investing are Republican strongholds, so excessive pressures on South Korea could jeopardize the political careers of Republican politicians in those areas. This implies that the second Trump administration will impose strong economic pressures on South Korea, their impact would not have a substantial impact. Instead, the critical factor will be whether the South Korean government prepares policies to use these pressures as an opportunity.
Second, in terms of security, the South Korean government should focus on three issues: the Special Measures Agreement (SMA) that decides defense burdens that each ally should bear. Unlike the Biden administration that sought security leverage from its alliances, the Trump administration during its first term strongly demanded more defense burdens from its allies. However, the second Trump administration’s demand for more defense burdens will not have substantial effects on South Korea’s security. On October 5th, South Korea and the US signed the SMA from 2026 to 2030. It is possible that the second Trump administration will withdraw this agreement, but such decision would provide opportunities for the South Korean government to demand enhanced control over the United States Forces Korea or amendments to the Korea-U.S. nuclear agreement to allow building nuclear-powered submarines or peaceful uranium enrichment because of reputation costs incurred by the decision to withdraw from the SMA from 2026 to 2030. Consequently, the second Trump administration will try to impose more defense burdens on South Korea, but this policy will not substantially affect South Korean security because of higher costs to withdraw the SMA.
In conclusion, the advent of the second Trump administration will not deliver a significant shock to South Korea. The characteristics of the Trump administration are already well understood. While there are differences in detail, his foreign policy goals are not dramatically different from the Biden administration’s. The South Korean government must thoroughly analyze the economic and security situations and effectively prepare for communication with the US government. This will be the most critical factor moving forward.
Woo Jung-moo
Associate Professor
Department of Political Science and Diplomacy