Maurice Obstfeld Raises Alarms Over South Korea-US Trade Deal

Maurice Obstfeld, economist and professor emeritus at the University of California, Berkeley, has voiced significant concerns over the 2025 South Korea-US trade agreement, highlighting 'uncertainties' in its current form. Under this agreement, South Korean goods are set to face a 15% tariff, while US exports remain duty-free, according to the Maeil Business Newspaper.

During a press conference at the 2025 G20 Global Financial Stability Conference in Korea, Obstfeld stated that the agreement might be interpreted differently by each country involved. He lamented the lack of specificity on profit-sharing and investment responsibilities, warning that the US might impose new demands if trade conditions remain unsatisfactory.

Obstfeld contrasted the past US administration's negotiating methods under Donald Trump with the current approach, noting disparities in reliability. Additionally, he discussed the potential impacts of US tariff policies on exchange rates and emphasized the importance of maintaining strategic trade relations with China. Obstfeld recommends South Korea consider joining the CPTPP to buffer against potential US trade reductions.

(With inputs from agencies.)